Batam

Batam has enjoyed limited FTZ status since 1978, with businesses enjoying benefits such as exemption from import duties, income and value-added taxes for all export-oriented industries. Singapore’s companies in particular, starved of space at home, have been lured by Batam’s free-trade environment and its cheap land and labour.
The granting of full FTZ status to Batam (as well as parts of the nearby islands of Karimun and Bintan) by the central government in Jakarta was seen as a response to growing regional competition. Among the potential rivals is Malaysia’s ambitious Iskandar Development Region (IDR) project in Johor, which will include a new regional manufacturing hub with linkage to Singapore.
Batam, which currently has 14 industrial zones, has so far attracted more than 600 foreign companies, that employ more than 170,000 local workers. Foreign investment in 2006 was US$4.5 billion, up from US$3.5 billion the previous year, with about 7 per cent of the island’s economic growth since the early 1980s coming from the export-oriented manufacturing sector.
Condos
Batam’s property developers have been increasing interest in condominium developments, although overseas buyers are still very much the minority among those buying. According to Ir. Cahya, chairman and founder of top Batam property developer Arsikon, more than 85 per cent of the buyers of residential properties are Indonesians. Starting as a contractor, Arsikon first ventured into the property sector in 2000 and is now one of the island’s top two developers. Along with PKP, Arsikon accounts for about 30 residential sites under development on the island. While PKP sells mostly low to middle-level housing, Arsikon also extends offerings to the high-end market.
Local property executives say Batam is increasingly becoming a residential magnet not only for Indonesians from the surrounding Riau province but also Surabaya and Jakarta in Java, as well as further afield from Sumatra and Kalimantan. All are attracted to the growing job and business opportunities offered by sprouting industrial parks and commercial activities all over the Indonesian island, a 45-minute ferry ride from Singapore.

Demand for low and middle-priced units had been picking up since the second half of 2006 as more new residents looked to settle in Batam. The island also acts as a transit point for Indonesian businessmen from Surabaya and Jakarta, many of whom are beginning the move of part of their operations to Batam in the wake of the island’s new free trade zone status.
Houses and Land
The most eagerly anticipated land plot villa development is currently getting under way. The Coastarina, a 150-hectare site next to Batam’s main ferry point, is the work of leading Batam property developer Arsikon. It’s based on a coastal-living concept similar to Sentosa Cove in Singapore, but at a fraction of the price. The choice units are located in The World at Coastarina, a bayfront lagoon where the land parcels are shaped in a miniature replica of the continents, as with the original Dubai development of the same name. Each plot is named after countries, states, provinces and famous cities.

The Africa parcel includes Senegal, Morocco, Liberia and Emirates, while a large number of the plots in the Asia parcel are named after Chinese provinces such as Henan, Anhui, Yunnan and Guanxi. There’s even a Hollywood Walk of Fame with plots named after celebrities like Michael Jackson, Madonna and Marilyn Monroe. In total, 1,200 plots will be developed in three phases, with final completion slated for 2013.

The cost of the built-up units at the outer perimeter currently range from S$120,000-$260,000, while plots closer to the sea, with average sizes of 600-2,000sqm, range from S$190,000-$600,000. Besides the residential properties, Arsikon will also be building a 3km seaside walk, with further plans for restaurants and shopping arcades at Coastarina.
The S$2 billion Coastarina project is meant to be developed as an iconic piece of real estate for Batam, and Indonesia itself. Once completed and lit up, The World will be visible to travellers flying into Changi and other airports in the region, firmly putting Batam on the regional property map.