The Rich And Indonesian Claim Perth As Their New Bolthole
Sydney Morning Herald
Friday August 9, 1996
As the political crisis in Jakarta escalates, Indonesia's elite have found an unexpected refuge in tranquil Perth. DAVID JENKINS reports.
It is early in the evening in Perth and a convoy of three luxuriously appointed Toyota Taragos is ferrying Indonesian generals and businessmen out to one of the city's plusher suburbs. In the front seat, silent and ruminative, is General Benny Moerdani , Indonesia's former Defence Minister.
"Do you know General Edi ?" asks a retired air vice-marshal, making conversation as we wait at a red light.
"General Edi Sudradjat ?" I ask, assuming he is referring to the Indonesian Defence Minister.
"No, no. General Eddie Nalapraja . The dinner is at his house."
Major-General (retired) Haji Eddie Marzuki Nalapraja, 65, is one of the more colourful - and well-connected - figures to emerge from the Indonesian army.
A former head of President Soeharto's security detail and a former vice-governor of Jakarta, he is the very model of the modern Indonesian major-general.
Well, almost. General Eddie doesn't actually live in Indonesia these days. He prefers Western Australia. He commutes regularly between Perth and Jakarta.
In a development that few would have predicted only five years ago, Perth has become a playground and home-away-from-home for a growing number of wealthy Indonesians, both Chinese and pribumi (indigenous).
In the suburban shopping malls, the language you hear is frequently Bahasa Indonesia . In some suburbs, the air fairly crackles with the smoke of kretek , Indonesia's sweet-smelling clove cigaretes. You can buy Indonesian newspapers, sample Indonesian regional cooking. Business is booming.
Garuda has seven Jakarta-Perth flights a week, Sempati four and Qantas three; Bouraq is planning a Surabaya-Perth link.
Singaporeans and Malaysians may still be the biggest foreign investors by a long shot, especially in five-star Perth hotels and other CBD property. But the Indonesians are breathing down their necks.
The Indonesian businessman Mr Atang Latief paid $75 million for the Hyatt Regency in Perth, now part of the Grand Hotel Group. Other Indonesians have developed an appetite for Perth CBD office blocks and apartments. Half the wealthy Chinese in Jakarta seem to have a second home in Perth, although it is not something they care to advertise.
"There are a lot of exceptionally wealthy Indonesians who live here or who have property here," says Mr Mark Sinclair, State regional manager for L. J. Hooker. "They're mainly Indonesian Chinese. They've all come in the last five years."
Many of the better-heeled Indonesians live in Burke Drive, a meandering road in suburban Attadale , complete with jacaranda trees and stunning views across the Swan River towards the city. A typical vacant block sells for $1 million. Other Indonesians have built "monster houses" on a subdivided Applecross headland where Alan Bond bulldozed an old hotel.
"All the property on Burke Drive is owned by Indonesians," says Mr Sinclair. "A typical house would cost $1 million to $1.5 million. All of the homes on the Bond subdivision are owned by Indonesians. In Applecross we're talking $1.5 to $4 million. One sold to Indonesians for $5.5 million two years ago."
More often than not, the architectural style is late 20th century post-modern, with gelato colours and vast sheets of black glass, set amid manicured lawns. Some houses look like spaceships. Occasionally there is one with Balinese statues on the gateposts, complete with checkered loincloths.
Nor is that the end of it. Indonesians have also invested heavily in Nedlands, Murdoch, Waterford and South Perth. There is a wealthy Indonesian Chinese community in the suburb of Booragoon .
If "high net-worth Indonesians" have resident status and are status conscious, they will buy into established Perth suburbs like Peppermint Grove and Claremont, says Mr Phil Simpson , managing director of the local Jones Lang Wootton office.
"But most are forced to buy off-plan to meet FIRB (Foreign Investment Review Board) requirements so they buy in newer areas like Winthrop , out near Murdoch University, which in fact has been named Wongthrop because within that suburb there's just a massive number of high net-worth Asians. That was a new suburb that opened up in a minor area and they just cleaned that out."
For members of Indonesia's emerging middle class, Perth has many attractions.
It's clean, it's close, it's safe.
Perth has schools, hospitals, golf resorts, a casino and property that is going for a song by South-East Asian standards. It's a great place to invest, especially if you're an Indonesian Chinese with a wary eye cocked on the future.
Perth is only four hours from Jakarta by air, about as close as Sydney. Unlike Sydney, it is in virtually the same time zone.
There are about 5,000 Indonesian students in Perth, attending universities and high schools. Thousands of other Indonesians come to gamble at the Burswood casino or to play golf at places like the Joondalup Country Club, a spectacular course where golfers have to drive between the sheer walls of an abandoned quarry. An Indonesian, Mr Johnny Basuki , owns 24 per cent of Joondalup; the rest is owned by three Singaporeans.
Other Indonesians come for major medical care, including heart and eye operations. General Mohammad Jusuf , 68, a former Defence Minister came here for a heart bypass and kidney transplant, adding another illustrious name to the Perth "zipper club".
Above all, Asians come to invest.
"The Indonesian community have been very big investors in WA," says Mr Sinclair. "They have invested in hotels, in commercial property, in residential property, in serviced apartments.
"There is quite a bit of Indonesian investment in 'land-banking'. They are buying up outer metropolitan, semi-rural blocks in large chunks for future sub-division. The population growth is going to be very big here."
Cashed-up Indonesian businessmen began taking a serious interest in Perth in 1990.
One of the first on the scene was Mr Joseph Tulong , who hammered out a deal that year to buy Alan Bond's Observation City Hotel for $77 million through his Indonesian company PT Aempe Pluit Bataco Raya ; the secretive Mr Tulong insisted on a strict confidentiality agreement which prevented Bond revealing his identity.
Another was Mr Jan Darmadi (Jau Fok Jo) , the son of the Jakarta casino king Mr Dadi Darmadi (Yauw Foet Sen) , who was prepared to outlay $185 million for a CBD office tower.
Yet another was the Summa Group of Jakarta tycoon Mr William Soeryadjaja , which held discussions with businessman Warren Anderson about a giant $1.5 billion three-tower office and hotel development, Westralia Square, in the heart of Perth.
Although each of these deals fell through, Summa did put down $12 million in loose change to buy the three-star Princes Plaza Hotel.
In 1991, Mr Atang Latief (Lauw Tjin Ho ), operating through one of his Singaporean companies, Lauw and Sons, bought the Hyatt Regency. Media reports said the hotel had been sold to "Singaporean interests".
This was not first Australian foray by Mr Latief, who operated the Copacabana Casino at Jakarta's Horizon Hotel until 1981, when the Government closed the nation's three casinos in the face of Islamic protests.
He had earlier teamed up with a Perth estate agent, Mr Frank Woodmore , to develop the Christmas Island casino, later selling his interest in the venture to another Indonesian businessman, Mr Robby Sumampow . Lauw and Sons Travel continues to act as the Singaporean agents for Christmas Island.
It is not uncommon for Indonesian investors to keep their cards close to the chest.
When it is suggested to General Nalapraja that few of the Sino-Indonesian names on the local company registers ring any bells, he is disarmingly frank.
"Normally," he says, "the man who shows up in the register, that's only cover, you know. Behind him, there's a big boss. Those people (on the register) are not even very familiar to us in Jakarta. It's only a front, using this name. And in the back, there's the other group."
The Indonesian consul, Mr Harijono Soeprapto, confesses that he is equally in the dark about some transactions. "Sometimes it's hard for us to know who is buying what," he admits.
Golf has been an irresistible lure to Asian investors. Three of the most popular golf courses - Joondalup , Meadow Springs and The Vines - are at the centre of large housing sub-divisions.
"The marketing of those lots has been pushed heavily in the Asian region," says Mr Simpson. "There has been massive success with Indonesians buying, particularly with The Vines. To an Indonesian, it just looked good to have a quarter-acre and a bungalow sitting on it and it was only going to cost you a couple of hundred thousand dollars.
"To Indonesians, that is just so cheap. They buy because it's cheap and come down here for golf and have somewhere to stay."
The arrival of a large number of Asians does not seem to have stirred undue resentment.
"I didn't realise they were so rich, those flamin' Indonesians," says a taxi driver as he cruises past the enormous houses that line Jutland Parade in Dalkeith.
"It's only when you drop them at their houses and see all the BMWs and Mercedes in the carport that you realise they're loaded." This observation is offered in a tone of admiration rather than envy or resentment.
"When houses are sold in Jutland Parade," he adds, "it's nearly always Asians that buy them. They always say 'for an undisclosed sum'."
Not that everyone approves of the "monster houses", especially when they are set in older suburbs, with no regard for the scale and character of the surrounding houses.
"In some of the wealthier suburbs - Peppermint Grove, Dalkeith, Nedlands, Claremont, Cottesloe - you are seeing an influx of Singaporeans, Malaysians, Indonesians and Japanese," says Pakistan-born Mr Imran Mohiuddin of Jones Lang Wootton.
"And the houses are disproportionately big relative to the size of the block and it doesn't look that good. The blocks are bigger than normal but then they construct these monster things."
For some, especially wealthy Indonesian Chinese, Perth is a bolt-hole, a place to put a million or two as a hedge against political instability, a place where the family can run in the event of an upsurge in racial tension.
For others, like General Nalapraja, the main attraction is the lifestyle. "It's a good life here," he says as his six-year-old son Adam hurtles up the marble-floored hall on roller blades, throws an expert left at the dining room and disappears into the kitchen.
"There's no pollution and you can drive anywhere. The hospitals are first-rate, with easy communication in English. In Tokyo hospitals, communication is a problem. It's a short flight - four hours.
"People don't realise there are now 40 million Indonesians who can afford education, health treatment, tourism. It's a good market for Australia. You have to grab them, by promoting your country, by working together."
PERTH THE INDONESIAN PRESENCE
ATTADALE
Wealthy Indonesians own virtually every house on prestigious Burke Drive, where vacant blocks start at $1 million.
APPLECROSS
All homes on this Bond subdivision owned by Indonesians. Prices: $1.5-$5.5 million.
CITY
Indonesians have invested in hotels, commercial/residential property, serviced apartments.
HYATT
Indonesian businessman Atang Latief paid $75 million for Hyatt Regency (now part of Grand Hotel Group).
LAND BANKING
Wealthy Indonesian Chinese snapping up semi-rural blocks on Perth outskirts with an eye to future subdivision.
AIRLINE Sempati Air, Indonesia's first private airline to operate on international routes, has four flights a week to Perth. Tommy Soeharto, youngest son of Indonesian president, has a 25 per cent stake in Sempati. Sino-Indonesian timber tycoon Bob Hasan, close associate of president, holds 35 per cent. Indonesian Army foundation holds remaining 40 per cent.
MEDICAL VISITS
Some prominent Indonesians, including a former Defence Minister, General Mohammad Jusuf, have travelled to Perth for heart by-passes, joining so-called "Zipper Club". General Jusuf was a private patient at Sir Charles Gairdner Hospital at Nedlands.
GOLF
Three of Perth's most popular golf courses - Joondalup , Meadow Springs and The Vines - are at centre of large housing sub-divisions. Indonesians have bought scores of houses, particularly at The Vines. An obscure Indonesian businessman, Johnny Basuki, owns 24 per cent of the Joondalup Country Club.
PAGE 15: Megawati interrogated.
© 1996 Sydney Morning Herald
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