They are held under one “right to build” title certificate as the local government is not allowed to subdivide the property and issue separate strata title certificates.
Siloam Hospitals Yogyakarta offers 240 hospital beds, while Lippo Plaza Yogya offers a 66,098-square-meter gross floor area (35,965 square meters for the mall area and 30,133 square meters for parking), which is already occupied by various tenants, including a movie theater operator, food sellers and a hypermarket. This mall has been in operational since June 2015.
Separately, LMIRT alone will acquire Lippo Mall Kuta, a retail mall component worth Rp 800 billion, situated on Bali Island, Indonesia’s most popular tourism destination.
Lippo Mall Kuta has been in operation since 2013, offering 21,132 square meters of commercial space occupied by tenants selling international and local brands such as Nike, Bata, Quiksilver, Planet Sports, Matahari Department Store, Hypermart and Cinemaxx.
“I’m pleased to report that we have signed a contractual sales and purchase agreement for two of our malls and one of our hospitals to our REITs, which will yield up to Rp 1.7 trillion [worth of transactions],” Ketut B. Wijaya, president director of Lippo Karawaci, said in the company’s statement.
REITs are investment funds that own, operate and profit from real estate through property or mortgages.
They are also traded on exchanges, such as the Singapore Stock Exchange.
The move, according to Ketut, is part of the company’s “light assets program” in which the property developer recycles capital that has achieved sustainable income in order to reduce operating costs and maximize profits.
Since the funds are listed in Singapore, the plans are still pending approval from regulators in Singapore, the Monetary Authority of Singapore and Singapore Exchange Securities Trading Limited, according ot the statement.
The Jakarta Globe is affiliated with LMIRT and First Reit through the Lippo Group.