Kusno Hardijanto, owner of Banua Group, inspects a model of the superblock project in Banjarmasin on Tuesday. (GA Photo)
BANJARMASIN, SOUTH KALIMANTAN: Property company Banua Group is committing up to Rp 4 trillion ($415 million) to develop several projects in Banjarmasin, including South Kalimantan’s first so-called real estate superblock, Jakarta Globe reported news.
Banua plans to build Banua Eco City, which consists of a condominium-hotel hybrid, apartments, a convention center, residential housing, a shopping mall and a city walk.
The integrated mixed-use property superblock will cost around Rp 2 trillion.
Company owner Kusno Hardjianto said he had conducted two years of surveys before deciding to invest. Kusno, initially from Central Java, owns businesses in contracting, coal mining, property and agriculture.
The superblock, on Jalan A. Yani, is looking to attract high-profile tenants, such as department store operators Sogo and Lotus. It is also keen for a local branch of hypermarket chain The Food Hall.
Banua is also building an integrated warehouse and trade center on 150 hectares of land, which will cost Rp 2 trillion.
The site for the warehouses and a trade center is called Multifunction Industrial Complex, and is aimed at serving distributors of goods across South Kalimantan.
It will be the biggest warehousing area in the province.
“The demand is huge, with many companies in mining, general trading and agriculture needing such a service,” Kusno said.
The complex is targeting medium and large companies that need warehouse services close to Banjarmasin’s Trisakti port and Syamsudin Noor Airport.
The location of the complex is also close to Central Kalimantan, easing the flow of goods between the two provinces.
All the construction work will be done by Kusno’s own companies.
Kalimantan, Indonesia’s biggest island by land mass, is rich in minerals including coal, iron ore and oil and is home to big corporations like Bumi Resources and Adaro Energy. It also has a large agricultural sector.
Adaro Indonesia, part of Adaro Energy, the country’s second-largest coal miner by production, has operations in South Kalimantan. Indo Tambangraya Megah, a unit of Banpu Group, a Thai coal miner, also has operations there.
Kusno on Tuesday told reporters that he first considered investing in Banjarmasin in 1997, when his construction business was hit hard by the Asian financial crisis.
Revenue at his companies fell after demand for construction collapsed in Solo, the city where he was born and grew his business.
Kusno said that in 1997 his business was struggling to survive, with about 70 trucks and heavy equipment idle, incurring great financial losses.
The crisis put a major strain on companies across the Indonesia, prompting the central bank to spend more than Rp 450 trillion on corporate bailouts.
Kusno said that in that year, he sent his idle equipment to South Kalimantan to transport coal, at the request of a friend.
He said he had considered tapping into the coal mining sector at the time, but he admitted on Tuesday that doing business in the sector was not easy.
Kusno then joined the coal business of his high school friend, Handoko Cokro Saputra.
In 2000, Handoko asked Kusno to build a coal terminal in South Kalimantan. A year later, he took a 10 percent stake in Central Korporindo International, a coal miner owned by Handoko family.
In 2008, Kusno bought out all other investors in the coal miner, which had changed its name to Exploitasi Energi.
Under his control, the company has transformed and now plans to invest up to $5 billion over the next 20 years to build electricity plants with a total capacity of up to 5,000 megawatts.
Kusno also serves as president commissioner of Exploitasi.
Kusno said he plans to expand his business South Kalimantan. He intends to expand his involvement in contracting, coal mining, energy and property, as well as grow his palm oil interests.
Kusno owns around 2,000 hectares of palm oil plantation area in the province.
He said he aimed to establish a crude palm oil processing facility, but declined to specify the size of the potential investment. “I always seek for opportunities to grow businesses. In the palm oil sector, I see planters here having difficulties in selling their products. There should be more factories to take their output,” he said.
Several other companies have also recently sought to invest in South Kalimantan. State tin producer Timah was last November reported to be seeking a mining concession there, while Krakatau Steel has built an iron smelter there.