We Build Where We Have Competitive Advantage

Dear All,

PT Bakrieland Development Tbk produced an impressive result during 2008 with revenue and net profit after tax of Rp1,053 billion and Rp272 billion, respectively, significant increase of 35% and 103% from the same period last year.

Following the favorable interest rate and higher demand for residential, the year ahead is looking more positive.

Bakrieland has performed very well by introducing a restructured Management team along with new plans and strategies. The Management performance and contribution to the result was brought about through excellent business strategy, strong cost controls, risk management and corporate governance.

Bakrieland’s purpose statement is ‘Growth through strategic alliance’. This simple yet powerful proposition provides clarity for strategic alignment of the Bakrieland. It recognizes that growth is important to shareholders and that Bakrieland’s ability to successfully deliver growth is best achieved by building and maintaining excellent relationships with all stakeholders.

Bakrieland’s vision is that ‘We will be a leading property developer. The vision is an aspirational statement that reaffirms the Bakrieland’s continued commitment to growth and reflects an understanding that excellent relationships must be founded on trust and ‘getting things right’. Underpinning Bakrieland’s strategic intentions are three core strategies:

    * Development focus
    * Development acceleration
    * Effective use of project financing

Bakrieland’s operating model is a combination of global and regionally oriented businesses. Where managing or transferring core skills or products between geographical markets give Bakrieland a competitive edge, a global management model exists, and where a regional focus is more important to ensure customer alignment, a regional management structure exists. Bakrieland consists of four lines of business:

    * City property
    * Landed residential
    * Hotel & resort
    * Property-related infrastructure

We have chosen to focus on residential property and infrastructure assets for several reasons. First and foremost, we have extensive background and well established platforms from which to operate these assets. In addition, the demand from institutional investors to own assets of this nature is increasing as they seek to earn increasing yields to meet their investment objectives. We believe that demand for these assets will continue to be strong because, in our view, they represent attractive alternatives to traditional fixed income investments, providing in many cases a “real return” that increases over time, relatively low volatility and strong capital protection. Finally, there is a substantial supply of investment opportunities in the form of existing assets as well as the need for continued development in an ever expanding global economy. At the same time there are relatively few organizations focusing on managing assets of this nature as a core strategy.

Our strategy for growth is centered around expanding our property under management, which should lead to increase revenues and profitability. We plan to achieve this within our existing operating platforms, through geographic expansion beyond our current focus in Jakarta CBD, Bogor, Bali, and by developing and acquiring platforms to operate new asset classes that demonstrate characteristics that are similar to our existing assets. We also plan to achieve growth by expanding our distribution capabilities to access a broader range of investment partners, thereby increasing our access to capital. This increased capital, when coupled with new investment opportunities, should increase our assets under management and the associated income, thereby increasing shareholder value.

Finally, on behalf of Management, we bestow the highest appreciation to the Shareholders, Board of Commissioners, all Employees, Partners and other Stakeholders upon the full support given to Bakrieland.