Mall Kingdom
    Category: Indonesia 50 Richest By : Renjani Puspo Sari Read : 76447 Date : Thursday, December 04, 2014 - 01:13:02

    Courtesy of Blacksteel Properties

    Michael Riady, grandson of billionaire Mochtar Riady, appears to have inherited his grandfather’s love of property, especially malls. He spent a decade working in the family’s Lippo group, rising to become the chief executive of Lippo Malls. He put that all behind him last year to venture out on his own, starting the real estate group BlackSteel Properties with his brother-in-law Isaac Bliss Tanihaha. “It’s an independent business, not related to Lippo,” says Michael, son of Andrew Riady. Michael owns half of the firm.

    Isaac, who married Michael’s sister Michelle, is also a veteran real estate developer, first in California, where he went to college. In California, he built luxury townhouses and mixed-use properties. Four years ago he returned to his home in Ambon, where his family had done well in the clove trade. Although the family had already dabbled in property—such as building the Surabaya Delta Plaza, one of the first modern supermarkets in Surabaya—Isaac went for it in a big way. His strategy: avoid the larger cities and focus on Ambon and other less developed areas in eastern Indonesia. In these markets there was growing demand, little supply and less competition. Isaac did projects in Ambon, Sorong and Kupang, under the name of the Bliss group.

    “I was inspired by Isaac. That’s why I joined him,” says Michael. When Isaac and Michael created BlackSteel, Isaac closed Bliss and put all its assets into the new firm. Michael became chief executive and Isaac became chief operations officer. Michael says he also got the full blessing and support of his family to launch his own company.

    Although Isaac got his start in the eastern Indonesia, the pair is chasing opportunities everywhere. They have about 10 projects in progress, one of them in East Java and another in Lombok that had its groundbreaking on May 24. In the coming five years, they plan to build 17 malls with total value of $300 million, after which they want to do an IPO in either Jakarta or Singapore. “We want to focus on being a mall player. It’s not an easy task, so we need to concentrate,” he says. In the long term, the pair wants BlackSteel to become one of the largest mall operators in the country, with a goal of 150 malls and $10 billion in revenue.

    To break into the mall business, the pair is willing to work together with local government enterprises, such as PT Patuh Patut Patju in Lombok. Michael also says that they are open to working with other property companies, including Lippo.

    The Lombok City Center project in Lombok is designed as a superblock that consists of a mall, hotel, hospital, apartments, shophouses and a conventional center, built on 8.8 hectares owned by Patuh Patut Patju. The Lombok City Center is slated to be the biggest shopping center on the island when launched in 2016.