South Korea’s GS Engineering & Construction Corp. (GS E&C) has joined hands with Indonesia’s leading developer Vasanta Group to build a residential complex in Jakarta, Indonesia, making an inroad into the growing housing market in the Southeast Asian country.

GS E&C said on Thursday that it signed an agreement with Vasanta Group to set up a joint venture to build a large residential complex dubbed City Gate 88. Each company will own a 50 percent stake in the joint venture with Vasanta Group contributing land it already owns and GS E&C investing about $20 million in the project for the remaining construction expenses. The Korean builder expects the joint venture would rake in about $200 million from the apartment sales.

The residential complex for 1,445 households will be built in Daan Magot, an up-and-coming residential area in western Jakarta that is much sought-after by the upper-middle class as it provides easy access to the city center. The project involves building five 25-to-30 floor apartment complexes and commercial facilities. GS E&C expects the construction and apartment sale to take six years from the commencement date.

The latest joint venture project comes as GS E&C has been expanding its presence in the Indonesian construction market in recent years.

GS E&C won a $750 million deal in the Southeast Asian country in 2011 to build a petrochemical plant in Cilacap and a $140 million project in 2013 to build a large shopping mall. With the City Gate 88 project, the Korean builder can make a foray into the country’s residential construction market.

An unnamed official from GS E&C said the company will successfully complete the latest housing development project to solidify its presence and enhance competitiveness in the Indonesian construction market.

By Park In-hye and Lee Eun-joo

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