Indonesia’s top Muslim clerical body launches 1 trln rupiah waqf-based fund for new office building
JAKARTA - The Indonesian Ulema Council (MUI) has launched a new waqf-based mutual fund of 1 trillion Indonesian rupiah ($70.8 million) to finance the purchase of its own new building, Lukmanul Hakim, its head of economy division told Salaam Gateway.
MUI, the country’s top Muslim clerical body, will acquire the 20-storey building that sits on 18 hectares of land in Bambu Apus, East Jakarta, from PT Asia Raya Kapital, the fund manager developing the property, according to Lukmanul.
Construction of MUI’s new building started in July and is expected to be completed by the end of 2020.
15 storeys of the new building will be allocated for commercial use, 5 floors will be reserved for MUI offices and 3 basement levels will be used for Islamic business such as halal food eating establishments, modest fashion windows and facilities for meetings, conferences and exhibitions.
“Investment for the five floors of MUI offices costs around 300 billion to 400 billion rupiah, and the entire tower will cost around 900 billion to 1 trillion rupiah to build,” said Lukmanul.
“Currently we have already collected 20-30 billion rupiah for the tower and we will continue to collect waqf through this mutual fund,” he added.
There are two types of investors to the endowment-based fund.
“The first type are people who want to give their waqf and can transfer their funds to our waqf account. This will be directly invested into the mutual fund managed by Asia Raya Kapital,” Lukmanul explained.
“Secondly, people can directly buy into the mutual fund and keep a part of its profit to help MUI’s tower development,” he added.
He said a new building is required to meet MUI’s growing number of activities and programmes.
The body runs 12 commissions and 10 institutions, including those overlooking fatawa and Islamic culture and art.
MUI generates income through its institutions, such as through halal certification, as well as from media interests in publishing and television.
For around 30 years, MUI was Indonesia’s sole halal certifier but from October 17 this year the government will take over this position, with MUI playing a supporting role only.
The CEO of Asia Raya Kapital, Tri Agung Winantoro, said MUI had expressed interest since last July to buy one of three towers established by the company’s Shariah-compliant limited mutual fund, Asia Raya Properti Syariah, that was launched in March 2017 in partnership with Prima Jaringan as developer.
MUI’s waqf-based mutual fund will buy over a portion of the existing limited mutual fund and ownership of the new building will fall to MUI’s waqf institution.
Asia Raya Kapital is 89 percent owned by Soetrisno Bachir, the former chairman of Islam-based political party Partai Amanat Nasional (PAN). 10 percent is owned by economist and Islamic finance advocate Muhammad Syafii Antonio.
Asia Raya Kapital held 1.57 trillion rupiah in assets under management at the end of Dec 2018, up 192 percent from 541.07 billion rupiah at the end of 2017.
($1 = 14,108.15 Indonesian rupiah)
(Reporting by Yosi Winosa; Editing by Emmy Abdul Alim [email protected])
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