Recommendations for Land Value of Non-Cash State Capital Participation (PMN) for Optimal Property Development in Plaju Assets, Palembang

Through Presidential Decree No. 117 of 2015, PT Hutama Karya (Persero) received an assignment from the government to build and manage the Trans Sumatra Toll Road concession. This situation has made the company form which was previously a Construction Services company, into a Construction and Toll Road Management company. To provide this project, both cash and non-cash funding are needed. Through Non-Cash PMN, the company gets capital in the form of land to be developed so that it becomes additional working capital for the company to develop the Trans Sumatra Toll Road. In the context of utilizing Non-Cash PMN, it is necessary to analyze the highest & best use of the given land, as well as determine the best form of development that can be carried out on the land. Based on these things, the company seeks to conduct financial analysis and feasibility studies of the non-cash PMN asset utilization project that has been obtained. The process of financial analysis and feasibility studies were carried out using Discounted Cash Flow (DCF) and Capital Budgeting Analysis in determining investment decisions for this project. Based on the results of the analysis and feasibility study, will determine the value of the land in accordance with the needs of PT Hutama Karya (Persero) to the Government, so that the Non-Cash PMN assets can provide added value for the company. Based on the projections, the real estate development scheme gives better results than ready to build area scheme. To achieve the minimum investment requirement of the company, HK will propose a value of Rp 73.775 per m2 and a maximum of Rp 113.500 per m2.