PT Bakrieland Development, Indonesia’s second-biggest property developer by assets, said its partner Dubai World may pull out of a real estate project in Jakarta and expects a decision within three months.
Limitless LLC, a property developer owned by Dubai World, agreed in September 2008 to invest in the project, valued at $1.7 billion at the time, and has delayed its investment following the global credit crisis, Bakrieland’s Chief Executive Officer Hiramsyah Sambudhy Thaib said. Limitless said it’s assessing its options for the venture.
“We’re trying to accelerate the progress again” after a delay in the development, Thaib said in an interview in Singapore yesterday. “We are now discussing the possibility of them pulling out of the deal. We are really hoping that we can move this project faster, after decisions are made.”
New investors may help revive the Rasuna Epicentrum apartment, office and retail project located in one of Jakarta’s busiest business districts, which was initially expected to be completed this year, Thaib said. Bakrieland, which is forecasting a 2012 completion, may divide Limitless’s stake into smaller portions to attract more investors should the company decide to pull out, Thaib said.
“We continue to assess options for this project that are in the best interests of our stakeholders,” Limitless said in an e-mailed response to questions from Bloomberg News.
In Dubai, the Middle East’s worst-performing property market in the last three years, Limitless and other developers are restarting stalled projects that are nearest to completion in the most attractive locations.
Limitless plans to restart work on four office and residential buildings in the Galleries development in Dubai next year, adding more than 600 apartments and 1 million square feet (93,000 square meters) of office space, Bahaa Abouhatab, head of projects for Limitless, said earlier this month
Dubai, the second-biggest of the seven sheikhdoms that make up the United Arab Emirates, sought neighboring Abu Dhabi’s help after the global crisis pushed property prices down by more than half and frozen credit markets forced some state-owned companies to delay loan payments. State-owned Dubai World signed a final agreement to restructure $25 billion of debt in March.
Limitless invested in Rasuna Epicentrum three years ago as its first development in Indonesia in a bid to expand overseas.