Cool! Despite The Pandemic, NWP Retail Is Eager To Acquire Shopping Centers, Once Bought A Mall Owned By Conglomerate Mochtar Riady

Lippo Mall Puri. (Photo: Doc. Lippo Mall)

JAKARTA - Shopping centers or malls are still bleeding from the COVID-19 pandemic. Moreover, during the implementation of the Emergency Community Activity Restriction (PPKM) until now PPKM Level 4 shopping centers have not been allowed to operate.

Even so, this condition did not dampen the plan of the retail shopping center platform company, NPW Retail, to postpone the mall acquisition plan.

Head of Commercial Marketing NWP Retail as the parent manager of The Park Sawangan Teges Prita Soraya said that all project planning will continue. It also plans to acquire malls or shopping centers.

"We are still building (shopping centers) and we still have our acquisition plan for other shopping centers. Those who are developing are still developing," he said in a virtual discussion, Tuesday, July 27.

But unfortunately, Teges did not explain in detail which shopping centers are included in his company's acquisition plan.

Teges said one of the reasons was the large Indonesian market and bright opportunities for shopping centers due to the COVID-19 pandemic Moreover, he said, in Southeast Asia, a country that has the potential to become a destination for investors is Indonesia.

"Indonesian foreign investors are still invited to dream, because maybe outside Southeast Asia, it's not bad even though they have to try investing in Indonesia. They still think maybe it's time to give Indonesia investment so that when the pandemic is over, infrastructure will be ready," he said.

However, Teges said that during the PPKM period, the government did not allow shopping center or mall developers to build. The reason is to avoid the spread of COVID-19.

"Incidentally we had to stop because PPKM is now asking for project development to stop. If last year construction was still allowed, contractors could still move, this year we were asked to stop. Actually we are heavy, the workers in the barracks are more dangerous than the workers who work," he said. .

In addition, Teges admitted that operationally it was certain that his party was bleeding in the face of the COVID-19 pandemic. Moreover, he said, the amount of debt is far greater than the value of the assets owned by the company.

"Because our bank installments are much larger than the construction of a mall which is 30 years old," he said.

At the end of 2019, PT Nirvana Wastu Pratama or NWP Retail, supported by main investor Warburg Pincus, purchased two shopping centers belonging to Lippo Malls Indonesia Retail Trust (LMIRT) for US$92 million or equivalent to Rp1.3 trillion.

The Conditional Sale and Purchase Agreement (CSPA) was signed by NWP with the LMRIT subsidiaries listed on the Singapore stock exchange.

The transaction covers two major retail assets, Pejaten Village, in Jakarta, and Binjai Supermall, in North Sumatra, with an occupancy rate of more than 90 percent. The two shopping centers are designed with an area of 89,157 square meters respectively for Pejaten Village, and 36,000 square meters for Binjai Supermall.

NWP Retail targets to be able to operate 30 shopping centers by 2022 with a prepared budget of IDR 2.8 trillion. The target locations for NWP Retail's expansion are in the second and third tier cities, including outside Java.

For information, the NWP Retail shopping center comes in three flags according to the targeted market segment. The top segment is The Park with an investment value of more than Rp. 200 billion.

Meanwhile, Citi Mall is targeting the lower segment with an investment of approximately IDR 200 billion. Then, the lowest segment is Citi Plaza's target with the smallest investment value.