Jakarta, Oct. 25, 2021 — Thousands of Indonesian families are set to benefit from an affordable green housing project that's also expected to create jobs and support growth in Southeast Asia's biggest economy amid the ongoing impact from the COVID-19 pandemic.
Under an agreement announced today, International Finance Corporation (IFC), part of the World Bank Group, will provide green loan of up to US$50 million equivalent in Indonesian Rupiah to PT Farpoint Realty Indonesia to be used for the construction of around 8,000 houses across Indonesia, including in the Greater Jakarta area. The partnership between IFC and FARPOINT will increase the supply of affordable houses while taking into account issues of sustainability with all homes to be built in compliance with green building standards.
The project, which targets lower and middle-income earning first home buyers, will contribute to the One Million Houses Program launched by President Joko Widodo in 2015 to encourage developers to offer sustainable residential properties at reasonable prices. Each housing cluster will comprise landed houses designed by well-known local architects with the aim of appealing young working families, and will include retail as well as green spaces for recreational activities.
"There has been a growing appreciation for distinctive and sustainable design in Indonesia across the office, residential and retail sectors. Our committed approach to sustainable building and construction incorporates technological advances and green building techniques to ensure a sustainable future for Indonesia," FARPOINT Chairman Husodo Angkosubroto said. "FARPOINT's concern towards sustainability is in line with IFC's mission thus with our partnership, we are confident in building affordable and sustainable housing for a much larger needing community in Indonesia."
This investment will see IFC playing a countercyclical role in providing long-term financing at a time when the Indonesian economy is recovering from a recession prompted by the COVID-19 pandemic. The investment is also consistent with the World Bank Group crisis response initiatives and Country Partnership Framework for Indonesia, which aims to promote private sector solutions and job creation by assisting countries to help firms invest in a greener, more sustainable and more inclusive economy during the COVID-19 recovery process.
"The COVID-19 pandemic has left an indelible mark on people of Indonesia and scarred the economy, making investments like this which will help create jobs and contribute to economic growth, even more critical," said Alfonso Garcia Mora, IFC Vice President for Asia and the Pacific. "With addressing climate change the other mammoth challenge the planet faces today, it's important we deliver investment that is sustainable but also more climate friendly. The construction of these homes will not only contribute to greening Indonesia but will provide a better quality of life for thousands of families."
With the proportion of the Indonesian population living in urban areas expected to rise from almost 55 percent to over 70 percent by 2045, there is a clear need to address a significant housing shortage in cities. It is estimated that there is already a housing backlog of approximately 12.1 million units and the need of around 780 thousand new units per year.
All houses built as part of this project will be constructed using IFC's Excellence in Design for Greater Efficiencies (EDGE) specifications, thereby meeting the IFC green building standards.
About IFC
IFC—a member of the World Bank Group—is the largest global development institution focused on the private sector in emerging markets. We work in more than 100 countries, using our capital, expertise, and influence to create markets and opportunities in developing countries. In fiscal year 2021, IFC committed a record $31.5 billion to private companies and financial institutions in developing countries, leveraging the power of the private sector to end extreme poverty and boost shared prosperity as economies grapple with the impacts of the COVID-19 pandemic. For more information, visit www.ifc.org.
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About FARPOINT
FARPOINT is an Indonesian real estate developer that presents and manages property with high-quality standards and designs. FARPOINT is a wholly owned subsidiary of Gunung Sewu Group, a well-established and respected business group in Indonesia. With a vision of becoming a trusted real estate company with employees who wholeheartedly produce innovative products and quality experiences, provide value to its stakeholders, FARPOINT is supported by more than 30 years of experience in the development and management of residential property assets, commercial, hospitality and retail. For more information, visit www.farpoint.co.id.
