Indonesia's Lippo to start $1.2 bln Jakarta project

JAKARTA, April 4 (Reuters) - Indonesian property company, PT Lippo Karawaci Tbk (LPKR.JK), plans to start construction on a $1.2 billion property project in West Jakarta in the third quarter of this year, the firm said late on Thursday.

The company, controlled by Indonesia's Riady family, will build 11 towers to accommodate upmarket apartments, a hotel, a 65-storey office building, a hospital and entertainment complex, Michael Riady, a director at the company, told reporters.

Indonesia's Lippo Group, which runs hospitals and property firms, had said it would spend up to $10 billion on domestic real estate projects by 2014, and expects prime Jakarta property to double or triple in value by then.

"The first stage of the construction will begin in the third quarter of this year and is expected to be completed by 2010. The second phase of the development will begin in 2010 and end in 2013," the company said in a statement.

"For the financing we are relying on our internal cash and money generated from pre-construction sales as well as some bank loans," Riady said.

The group, which has listed units in Jakarta, Singapore, and Hong Kong, expects to benefit from strong economic growth and rising incomes in Indonesia and other parts of Asia, Chief Executive James Riady told Reuters in an interview late last year.

The Lippo Group has about 70 percent of its assets in Indonesia, where its listed units include Lippo Karawaci and Lippo Cikarang (LPCK.JK), two satellite town developments near Jakarta with their own hospitals, universities, malls, housing, offices and even golf courses. (Reporting by Nury Sybli, writing by Harry Suhartono, editing by Ed Davies)