BTN and KAI Collaboration Presents 5,400 New TOD Housing Units

JAKARTA - PT Bank Tabungan Negara (Persero) Tbk (BTN) and PT Kereta Api Indonesia (Persero) or KAI have collaborated on the development of transit-oriented development (TOD) based housing in a number of strategic cities in Indonesia. The collaboration was marked by the signing of a Memorandum of Understanding (MoU) between BTN President Director Nixon L.P. Napitupulu and KAI President Director Bobby Rasyidin in Jakarta, Friday, May 22.

The cooperation between BTN and KAI is focused on the development of vertical residential areas that are directly integrated with public transportation such as Commuter Line KRL, LRT, MRT, and Transjakarta. This initiative is part of the support of both SOEs for the Government's 3 Million House Program as well as answering the challenges of urbanization and land constraints in the city center.

BTN President Director Nixon L.P. Napitupulu said the TOD-based housing concept is becoming increasingly relevant for Indonesia because it is able to connect housing, transportation, and centers of economic activity in one integrated area.

"The development of the future city can no longer separate between housing, transportation, and the center of economic activity. Therefore, the concept of Transit Oriented Development or TOD is very relevant to be developed in Indonesia," said Nixon.

According to Nixon, many workers in Jakarta still live far from the city center so that transportation costs can reach 20% to 25% of their monthly income. Therefore, the development of vertical housing in the city center is considered to be a more efficient and affordable solution for urban people.

In addition, continued Nixon, the development of the station area as a residential center and economic activity has also become a trend in various developed countries such as Japan, Singapore, and Hong Kong. This model is considered capable of creating a more efficient, productive, and comfortable urban area for the community.

On the same occasion, KAI President Director Bobby Rasyidin said the project combines the concept of affordable housing, TOD areas, and the development of new business centers in Jakarta.

"We are combining three things actually. One is vertical housing that is affordable, which is part of an important program from the government of President Prabowo Subianto. The second is that we realize the TOD concept, Transit Oriented Development," said Bobby.

According to Bobby, the Manggarai area has a total area of around 62 hectares which will be developed into an integrated area which includes residential, commercial areas, business areas, sports facilities, and leisure areas.

"Third, in the Manggarai area we have 62 hectares that we will design will become the second CBD of Jakarta, equivalent to SCBD," explained Bobby.

In this cooperation, KAI through its subsidiary KAI Properti has prepared a number of strategic assets for the development of TOD housing in four cities, namely Jakarta, Bandung, Semarang, and Surabaya with a total potential of more than 5,400 housing units.

The planned locations include the Manggarai Station area, Blocks G and F, Jakarta, with a potential of around 2,200 units, Kiaracondong Bandung Station around 753 units, the Dr. Kariadi/Gergaji Semarang area around 1,042 units, and the Gubeng Surabaya Station area around 1,489 units.

Specifically for the initial phase of development in the Manggarai area, the project will be built on an area of approximately 2.2 hectares with the construction of the first three towers. Furthermore, the project will continue in an area of approximately 1.6 hectares for the development of eight vertical residential towers with a total of approximately 5,000 units.

The Manggarai TOD area is located at one of the largest transportation nodes in Indonesia which is directly connected to the Jabodetabek commuter line, airport trains, LRT, Transjakarta, to access the Jakarta MRT and business centers such as Sudirman, Thamrin, and Kuningan. Currently, the number of transportation users who enter and exit the Manggarai area reaches around 300 thousand people per day.

The developed housing consists of a 2-bedroom type with a size of around 45 square meters to 54 square meters to be more suitable for young families and growing families. The unit price is projected to start from around Rp500 million for the low-income community segment (MBR), while the non-subsidized units are marketed starting from around Rp700 million to above Rp1 billion depending on the type and location of the tower.

To support community affordability, BTN has prepared a FLPP terraced house mortgage facility with a fixed interest rate of 6 percent per year and a tenor of up to 30 years. With this scheme, people can have vertical housing in the city center with a down payment starting at 1 percent and an estimated installment of around Rp. 2.9 million per month for a unit worth Rp. 500 million. The program is aimed at people with a maximum income of Rp. 12 million per month for singles and Rp. 14 million per month for married people.

In addition to KPR for end consumers, BTN also prepares financing support through the Housing Program Credit (KPP) scheme to support the business ecosystem in residential areas, including individual MSMEs. Through this scheme, BTN provides financing ranging from IDR 10 million to IDR 500 million for the purchase, construction, and renovation of houses, which also supports community business activities.

According to Bobby, the project is expected to be a solution to the high cost of transportation for workers who have been living outside Jakarta but working in the city center.

"Today, many people live outside Jakarta because the price of houses in the city center is difficult to reach. In fact, the cost of transportation and mobility every day is also very large. Therefore, we want to present an alternative for housing that is closer, more efficient, and still affordable," said Bobby.

BTN in this cooperation will support the financing of construction, home ownership loan (KPR) facilities, and demand pipeline management to support the development of subsequent TOD projects in various strategic areas owned by KAI.

Currently, BTN and KAI have also bagged around thousands of potential early adopters for the Manggarai TOD project, which will be verified gradually as part of managing the housing demand database.

In the future, BTN and KAI will continue to discuss the technical and development of the project gradually so that the benefits of the TOD area can be immediately felt by the community while supporting the development of a more integrated city in Indonesia.