Making Dreams Real
    Category: Entrepreneurs By : Sonya Angraini Read : 1636 Date : Friday, November 14, 2014 - 13:26:34

    Ahmad Zamroni / Forbes Indonesia

    Elang Gumilang’s first experience in property was not smooth sailing. While still a university student, he borrowed Rp 150 million in an unsecured loan for a project. Due to mismanagement, the project failed and he had to pay monthly Rp 9 million for two years to pay back the loan. To cover this debt, he did sales and marketing for a property company. “I learnt a lot working in sales and marketing, which helped me understand the market better,” he recalls. Despite his failure, Elang started his own property business again in 2007 under the Elang group, known formally as PT Dwikarsa Semestaguna.

    Unlike most property companies chasing the middle and upper end of the market, Elang is developing low-cost housing. “I was moved because there are many people who can’t afford to buy houses due to high prices,” says Elang, 29, who studied economics at the Bogor Institute of Agriculture. He explains that the demand for low-cost housing in Indonesia is around 800,000 homes per year, but there are only 200,000 new houses available in this segment. “There is plenty of potential,” he adds. His first project was to build 100 units of low-cost housing in Bogor, which quickly sold out. To attract buyers, Elang also provides homebuyers with prizes such as motorcycles. His target market is low-income people because he has two purposes for his business: to generate a profit and have a social function. “We only make a reasonable profit,” he says.

    Elang now has a total of 14 projects, all in Bogor and Sukabumi, worth about Rp 2 trillion. Around four projects are already completed, five are under construction and the rest are in preparation, getting permits and land. In addition to low-cost housing, Elang also develops subsidized houses and other developments. Next year, Elang hopes to manage a total of Rp 10 trillion worth of projects. He also plans to build a resort located in Bogor.

    The price for his subsidized houses is below Rp 100 million, with installments around Rp 600,000 per month. Low-cost homes are priced around Rp 200 million. “We want to be the largest low-cost housing developer in West Java by 2020, in Java by 2025 and in Indonesia by 2030,” he boasts. To maintain low prices, Elang conducts research on building materials so he can lower the material cost. “We even produce some of our own material,” he explains. 

    Having been born and raised in Bogor, Elang decided to launch his business in his hometown. Another factor is the city’s six million residents and its strategic location close to four toll roads connecting Bogor to other cities such as Jakarta. However the Bogor market has challenges. Delays in land clearance, for example, means a project may take longer than expected to complete. Many locations are also quite remote, thus Elang also has to provide amenities such as shopping, water supply and security. “The function of a house is to build a living system,” he explains.