Tag Archives: emaar

The US$ 600 Million Question

Confusion Reigns Over Status of Emaar Mega Tourism Project in Lombok.

(7/31/2010) A fair degree of confusion prevails over the future of a US$600 mega tourism project on Bali’s near neighbor of Lombok.

A pet project of Indonesia’s former Vice-President Jusuf Kalla, the 1,200 hectare site was proposed to house hotels, condominiums and a golf course financed by Dubai-based property Developer Emaar Properties. The project – hailed by its champions as having the potential to create a popular destination in Indonesia for travelers from the Middle East – provided the impetus for the massive investment in a new international airport nearing completion in Lombok.

The future of the Emaar Project became doubtful last year when the Dubai investors called for changes in land ownership rules. These objections from Dubai, whether real or posed, were put forth at a time when the Dubai property bubble was bursting, causing some quarters to conjecture that Emaar was no longer in a financial position to carry through with its original commitment for Lombok.

Countering this view, Emaar recently declared that the idle project is still on track. As reported by the Jakarta Globe, the Dubai property company has issued a statement declaring it has made a “total commitment” to its Indonesian partner, the Bali Tourism Development Corporation (BTDC). The statement from Emaar was made apparently to forestall a threat by the Indonesian government to re-tender the project and find a replacement investor.

Recently the chairman of the Indonesian foreign Investment Coordinating Board (BKPM), Gita Wirjawan, signaled interest in reviving the long-stalled Lombok project has come from Abu Dhabi, Qatar, the United Arab Emirates and India.

A spokesman for Emaar is insisting that the company “has strong financial fundamentals and will undertake all strategic projects across its key markets.”

Source: http://www.balidiscovery.com

Emaar the boot?

Govt gives Emaar the boot, looks for new funds

Andi Haswidi , The Jakarta Post | Wed, 01/27/2010 3:37 PM | Headlines

The government has decided to terminate all commitments with Dubai-based Emaar Properties on a plan to build a US$600 million mega-tourism project in Lombok, West Nusa Tenggara.

Investment Coordinating Board (BKPM) chairman Gita Wirjawan said Tuesday that Emaar had failed to meet its share of the bargain in developing the project.

Gita said the government, represented by the West Nusa Tenggara government, had followed through with its commitments, including building an airport – to be completed in June – a 31-kilometer road connecting Mataram to the airport and an 18-kilometer road from the airport to Kuta Beach.

“*Emaar* failed to reciprocate in kind. We have taken this decision to ensure fairness and we will look for other possibilities,” Gita said.

The mega-tourism project has been marked by finger-pointing since Emaar signed a joint venture agreement with the Bali Tourism Development Corporation (BTDC) in March 2008. The agreement included establishing a joint venture company called Emaar Lombok.

Emaar claimed last year that the Indonesian government had failed to follow through with some of its promises, citing in particular the clearance of a 1,200-hectare area of land required for construction.

In October, Alwi Shihab, Indonesia’s special envoy to the Middle East, who also worked extensively on the project, said the land dispute was solved and that the project would follow through.

Further development showed that around 1,000 hectares had been set aside by the government for the project but still required certification from the National Land Agency (BPN), while the remainder still belonged to local residents.

A disagreement surrounding the company’s investment contributions and ownership in the joint venture has also overshadowed the project.

State SOE Minister Mustafa Abubakar said earlier this month the deal with Emaar had expired, but the company would be given a chance to sign a new deal.

Both parties had agreed to a Dec. 31 deadline to solve the numerous problems plaguing the project. Mustafa said the deadline would not be extended but said he was willing to have fresh talks with Emaar about restarting the much-delayed project.

Gita hinted that the decision to kick Emaar out of Lombok was also in the interest of the property company as it was currently struggling from the impact of the financial crisis.

“Dubai World has been heavily affected by the financial crisis. They have to restructure $59 billion in debt. This will have repercussions on Emaar, which is based in Dubai.

“The company also embarked on massive projects in Saudi Arabia and the United Arab Emirates. There are a financial limitation. Secondly, they prefer to focus on settling their problems in the Middle East,” Gita said.

No Emaar official was available for comment Tuesday.

Gita said his office had been in talks with investors interested in replacing Emaar.

“We have met with interested investors. One from the Middle East and another from outside the region,” he said, refusing to elaborate further.

West Nusa Tenggara province, located just east of Bali, has become the central focus of the ministry’s tourism programs, with a specific program aiming to draw one million tourists to the province by 2012.

The province is rich in marine life and will be developed as the center for the pearl trade and ecotourism. Famous Lombok tourist sites include Senggigi Beach, the three Gili islands, Mt. Rinjani and Lake Segara Anak.

Tourist spots in the more secluded Sumbawa Island include Mt. Tambora, Moyo Island, Jelenga Beach and Maluk Beach.

Emaar eyes talks over $600m island resort

by Shane McGinley on Tuesday, 05 January 2010

Emaar Properties will meet with Indonesian authorities in early 2010 to address progress on its $600m planned resort development near Bali, the Dubai developer told Arabian Business on Tuesday.

The Jakarta Globe newspaper last week reported that Indonesian government officials appeared to be distancing themselves from Emaar as their joint venture agreement ran out on December 31.

The $600m Lombok project, launched by the former Indonesian Vice President Jusuf Kalla in May 2007, is planned to be a 1,200-hectare resort located at the Kuta and Tanjung A’an beaches. The project is a joint venture between Emaar, the state-owned Bali Tourism Development Corporation (BTDC) and local government.

In June 2009 at a meeting in Dubai, the Indonesian Government extended the joint venture between Emaar Indonesia and PT Pengembangan Pariwisata Bali (Persero), a government entity, to develop The Lombok Project by the end of the year.

“Emaar is working with Indonesian authorities with a focus on addressing the final pending areas, primarily in relation to transfer of available land. The two parties have agreed to meet in Jakarta in early 2010 to agree on the next steps regarding The Lombok Project,” Emaar said in a statement.

“Communication between Emaar and BTDC is still good. I think the plan could still go forward,” Hilmi Gasim, assistant to Alwi Shihab, the special Indonesian presidential envoy to the Middle East, told the Jakarta Globe

EMAAR and the JV

Emaar and Indonesian Government extend JV to develop The Lombok Project by six months.

The Indonesian Government has extended the joint venture between Emaar Indonesia and PT Pengembangan Pariwisata Bali (Persero), a government entity, to develop The Lombok Project by six months. This followed a meeting between the representatives of the Indonesian Government and Emaar International in Dubai.

As per the agreement, the joint venture partnership has been extended till December 31, 2009, to complete all modalities associated with developing a mixed-use project set on the Kuta and Tanjung beaches on the island of Lombok. Dr Alwi Shihab, President’s special Envoy to the Middle East, representing the Indonesian Government, said:

‘The Lombok Project has the strong potential for the development of the social and economic welfare of Lombok to complement other existing tourist infrastructures available in the region. To undertake such a complex project, taking into account all environmental and development considerations, it is important to evaluate all aspects thoroughly. We have therefore extended the joint venture by six months.’

He added: ‘Emaar has the proven competencies to undertake complex development projects and we look forward to completing all formalities very soon to expedite the development process.’

Mr Sergio Casari, Chief Executive Officer, Emaar International: ‘We are thankful to the Indonesian Government for their trust in Emaar in undertaking The Lombok Project. Indonesia is one of the key markets for Emaar, and our expansion to the country is in line with the company’s growth strategy of geographic expansion and business segmentation.’ He added:

‘The Lombok Project will create a new dynamics to the property sector of the region, and the resort-style project will catalyse inward investments to Indonesia. Emaar has completed the master-plan for the project already, and we look forward to completing all necessary formalities and obtaining governmental approvals for commencing development.’<
At the meeting held in Dubai, several aspects of the joint venture were finalised, thus adding to the development momentum of The Lombok Project.

The Lombok Project is envisaged as an environmentally friendly, integrated residential, leisure and hospitality zone. The project will have extensive natural waterfront that supports a marina, luxury residences and resorts by the world’s very best luxurious hospitality operators; the homes will have tropical designs and low-rise architecture. The development will drive tourism to the region by offering a spread of activities such as diving, snorkeling, hiking and surfing sports.