CASE STUDY ANALYSIS ON REGIONAL DEVELOPMENT OF AEROTROPOLIS

CONCEPTUAL DESIGN ON RADIN INTEN II AIRPORT

Mohammed Ali Berawi, [Link], Ph.D1, Afif Dandy Adhityo2, Galih Raka Sakti3
Civil Engineering, Faculty of Engineering Universitas Indonesia
Campus UI Depok, Jawa Barat 16424, Indonesia

(Received: Mmmm YYYY / Revised: Mmmm YYYY / Accepted: Mmmm YYYY)

ABSTRACT
Airport is a public infrastructure area that used to accommodate inter-regional activities. The existence
of the airport for the passengers movement, logistical supply chain, business area, and etc can be the key
driving factors for economic growth and added value to the region. Based on the regional’s gross
domestic product, Lampung Province is one of the lagging regions in Indonesia, with total contribution
to Indonesia Province gross regional domestic product 2015 in amount of 199,525 or just 1.73% in
compare with Indonesia gross domestic produk, hence to increase economic growth in the region, this
research is aimed to generate conceptual design and initial cost calculation of Raden Inten II airport
based on aerotropolis. The concept of aerotropolis is aimed to improve airport’s accessibility along with
urban growth center, plan the development on each corridor, to make well developed, efficient, and
effective. To identify the distribution of potential sector as the baseline for development purposes, hence
the method of location quotient is applied to design the region and time value of money to estimate
initial cost of investment. The result of this research is by developing Radin Inten II Airports in
Lampung Province with about 1447 Hectare that consist of industrial area, mixed-use area, supporting
infrastructure such as power plant, integrated water and waste water treatment plant, and massive public
transport named bus rapid transit (BRT) with initial cost of investment in amount of
$ 13,540,080,020.93.

Keywords: Aerotropolis, Conceptual Design, Regional Development, Radin Inten II Airports, Initial
Cost,

1 INTRODUCTION
1.1 Literature Review
In the current era of globalization, human activity is valued both in terms of speed, effectiveness and
efficiency, especially in terms of human movement, goods, and information. To support it requires
mobility and access that allows people in the move. Good mobility can spur to reach the world secra
globally and quickly, effectively and efficiently. High mobility requires transportation facilities and
infrastructure, whether land, sea, or air, as an instrument to fulfill human activities. The terrestrial modes
offer flexibility and ease of reach, but with insufficient cruising range. The sea transportation modes
offer considerable carrying capacity, but with long travel times. While the air transportation mode is
considered as a mode of transportation that has a high speed, and able to reach to all areas that cannot be
reached by other modes of transportation (Permenhub No.49 of 2005 on the National Transport System).
Air transport is an air transport activity (Raharjo Adisasmita, 2013). In operation the air transportation
mode requires the airport as a means to take off and land. Now in the 21st century, the development of
transportation is also followed by the airport. Along with the rapid development of the airport and the
increasing demand for air transport, as well as the anticipation of the construction around the airport
unplanned, then born the concept of aerotropolis. Aerotropolis is a form of airport integration with an
independent metropolis around it, which then encourages the development of 3 businesses to enhance
the economic growth of the metropolis (John D. Kasarda & Greg Lindsay, 2011). The aerotropical
concept aims to improve the accessibility of airports with urban growth centers, plan development on
each corridor, resulting in an orderly, efficient, and effective form of integration in delivering benefits.
In the world, many airports are applying the concept of aerotropolis, Amsterdam Schipol Airport in the
Netherlands, Los Angeles Airport in the United States, Incheon Airport in South Korea, and Changi
Airport in Singapore, is a successful example of the application of aerotropolis concepts that can
integrate city, airport and Business area. The formation of Aerotropolis in the world is basically in line
with the development of infrastructure as a new approach in the planning and development of
sustainable urban areas. Aerotropolis is an urban urban design, infrastructure, and economy centered on
an airport. The ultimate goal is not only to achieve efficiency, speed and connectivity alone, but also to
improve the quality of life in urban space that is safe, comfortable, productive and sustainable.
Indonesia as an archipelagic country certainly desperately needs the role of air transportation to reach
the islands throughout Indonesia. The need for air transportation will be directly proportional to the need
for the airport. Therefore, airport development is also important to support air transport activities in
Indonesia. However, as with some airport developments elsewhere, the development of airports in
Indonesia is still causing some problems such as inadequate infrastructure, affordability of airports,
unfettered airport developments, to airport facilities of inadequate quality. Ministry of Public Works sees
three important elements in the realization of aerotropolis is urban planning, plans and designs produced
must have adequate legal basis for the development of the region can be sustainable. Airport planning
emphasizes airport capacity building strategies for at least 20-30 years ahead. While the business site
planning is the effort to create the attractiveness of the region as a concentration of investment.
As with the concept of aerotropolis, an airport will be a center of activity surrounded by various
supporting facilities such as offices, commercial areas, entertainment areas, health services class, to the
academic world and various industries. For that region to be developed as the location of Aerotropolis
development is Lampung. In Lampung province, especially South Lampung district, it was chosen to be
the case study location for Aerotropolis development due to the potential of supporting area and the
presence of the airport that serve as the research object of Radin Inten II Airport. The TKG-coded airport
is highly potential to be developed as it still has a land area of 9,650 square meters for development as
well as its strategic location which is relatively close to other Asian countries as well as with countries in
the Middle East region.
1.2 Problem Statement
Then, the aim of this research is to produce the conceptual design of Lampung Aerotropolis District that
will be implemented in Radin Inten II Airport. The development of Lampung Aerotropolis District will
be including some components that support Radin Inten II Airport, which the components are airport
development, industrial region, mixed use region, and supporting region. The first component which is
airport development consist of terminal upgrade, runway rehabilitation, and some supporting airport
building. The second component, industrial region will consist some processing industrial, spesifically
based on food and drink processing industry. Third componen mixed use region that consist commercial
area, office area, residensial area, hotels, parks, etc. Fourth component is supporting region that consist
purified water treatment plant, sewage treatment plant, geothermal power plant, bus rapid trasportation,
and city way as the access for Lampung Aerotropolis District. Then all of those components will be
review by benchmarking to get the construction cost for every developmet sector. In the end of this
research will reveal investment cost for the whole construction building in Lampung Aerotropolis
District development in Radin Inten II Airport.

2 METHODS
This research will focus on designing the design and also taking into account the value of Initial Cost
from Aerotropolis project development as a regional development concept. Aerotropolis project
planning will take a case study at Radin Inten II Airport Branti South Lampung District, Lampung
Province. The initial design concept of Aerotropolis was designed based on technical data on the area,
such as regional potential (crops, industry, etc.), regional economic growth (GDRP), traffic growth at
airports such as passengers, goods, and cargo. From these data will be seen the development of the
region that occurred in the area and reinforced by institutional studies on which the theory is based.
In doing research, there are three strategies that can be used that is quantitative, qualitative and mixed.
These strategies are generally referred to as research approaches (Creswell, 2007). The research strategy
includes the overall skills, assumptions, and practices that qualitative researchers use to move from the
paradigm and research design phases to the stages of collecting empirical data. The research method
serves to test the research hypothesis and achieve the purpose of this research. The research method is
chosen based on what goals to be achieved and the type of research conducted. The research method
used is highly dependent on the kind of research conducted as well as the goals to be achieved
2.1 Location Quotient
Location quotient (LQ) is basically a way of quantifying how concentrated a particular industry, cluster,
occupation, or demographic group is in a region as compared to the nation. It can reveal what makes a
particular region “unique” in comparison to the national average. This analytical technique has not been
able to provide the final conclusions of the sectors identified as strategic sectors. But for the first stage it
is enough to give an idea of the ability of a region in the identified sector. The mathematical formula
used to compare the capabilities of the sectors of the area is (Warpani, 1984: 68). The formula approach
used here is a comparative function of the relative magnitude of GDRP of a commodity in the region
with the magnitude of GDRP of a commodity 1 level over the area under consideration:

Location Quotient Analysis

Industrial Origin LQ Ratio Rank

1 Agriculture, Livestock, Foresty, and Fishery 0.956926188 8

2 Mining and Quarrying 0.259469712 17

3 Manufacturing 1.342998162 1

4 Electricity and Gas 1.223311359 3

5 Water Supply 1.21344653 4

6 Construction 1.253388662 2

7 Wholesale and Retail, Car and Motorcycle Reparation 1.073021 6

8 Transportation and warehousing 1.156065163 5

9 Accomodation and Food and Beverage 0.961749015 7

10 Information and Communication 0.786107104 12

11 Financial Services 0.853402654 10

12 Real Estate 0.793079142 11

13 Business Services 0.609564882 15

14 Government, Defense, and Social Assurance 0.622694281 14

15 Education Services 0.863663229 9

16 Health Services and Social Activity 0.586320045 16

17 Others Services 0.683451107 13

From table rank of LQ value above it is known that processing industry topped the first rank with LQ
value equal to 1.343, followed by construction sector with LQ value equal to 1,253, then in third place is
electric & gas procurement sector with LQ value equal to 1,223, fourth place occupied water supply
sector , Waste treatment, waste & recycling with LQ value 1,213, fifth order is transportation
warehousing sector with LQ value of 1,156, and in last or sixth sequence there is big trading & retail
sector, car & motorcycle repair with LQ value equal to 1,073. From these results will be selected for the
sector that will be developed in Aerotropolis concept at Radin Inten II Airport.
2.2 Time Value Of Money
Time Value of Money (TVM) is an important concept in financial management. It can be used to
compare investment alternatives and to solve problems involving loans, mortgages, leases, savings, and
annuities. TVM is based on the concept that a dollar that you have today is worth more than the promise
or expectation that you will receive a dollar in the future. Money that you hold today is worth more
because you can invest it and earn interest. After all, you should receive some compensation for
foregoing spending. For instance, you can invest your dollar for one year at a 6% annual interest rate
and accumulate $1.06 at the end of the year. You can say that the future value of the dollar is $1.06
given a 6% interest rate and a one-year period. It follows that the present value of the $1.06 you expect
to receive in one year is only $1. The most fundamental TVM formula takes into account the follow
rules :

Radin Inten II Aerotropolis Developments

Benchmark
Components Amount (Rp)
Year
Industrial Region 7,314,905,636,703.46 2007-2014
Mixed Use Region 59,005,213,003,195.90 2016
Geothermal Power Plant 2,569,446,405,219.69 2012
Purified Water Treatment
249,716,834,746.90 2013
Plant
Sewage Treatment Plant 101,170,314,652.49 2014
Transportation Access Way 258,070,076,714.40 2010
BRT 453,313,134,187.49 2015
Airport development 42,545,882,474,442.30 2014

From the table is known value of investment cost on each component developed. Each component has
an investment cost value applicable to the price in different years. Therefore the data needs to be
inserted into the formula of Time Value Of Money so that the value of the final investment cost in
getting is a list of investment costs in the same year. The author targets the implementation of this
Aerotropolis project in 2025. For further discussion will be discussed in accordance with the
development component.

3 RESULTS AND DISCUSSION

3.1 Lampung Aerotropolis District Modelling
3.1.1 Analysis of Location Quotient
In this research used Location Quotient method where writer must first know data about GDRP target
area of development that is Lampung more precisely South Lampung District, that is Airport Radin
Inten II which will become center of new Aerotropolis in Indonesia. To get data of GDRP of location of
development of writer do take data directly from website of statistic Indonesia, that is Badan Pusat
Statistik and further exploration to data - needed data especially statistic data at Lampung Province.
After conducting an in-depth exploration of the GDRP data obtained from the Indonesian Central
Bureau of Statistics and Lampung Province, data obtained from GDP Lampung and GDRP of South
Lampung District were obtained from the Indonesian Central Bureau of Statistics and Local Statistics
Center website. The following is a description of the GDRP data found
Table RESULTS AND DISCUSSION.1Lampung Province GDRP Sector Distribution

GDRP of Lampung Province at 2010 Constant Market Prices

Industrial Origin 2015
A Agriculture, Livestock, Foresty, and Fishery $ 4,809,450,237.72
B Mining and Quarrying $ 908,696,560.60
C Manufacturing $ 2,701,642,888.74
D Electricity and Gas $ 15,336,853.98
E Water Supply $ 15,095,888.06
F Construction $ 1,309,949,438.80
G Wholesale and Retail, Car and Motorcycle Reparation $ 1,742,569,817.20
 GDRP of Lampung Province at 2010 Constant Market Prices
Industrial Origin 2015
H Transportation and warehousing $ 735,699,174.00
I Accomodation and Food and Beverage $ 198,071,341.31
J Information and Communication $ 632,434,278.19
K Financial Services $ 311,699,672.76
L Real Estate $ 448,818,666.97
M,N Business Services $ 21,450,511.55
O Government, Defense, and Social Assurance $ 483,239,232.68
P Education Services $ 403,340,043.63
Q Health Services and Social Activity $ 143,157,176.71
R,S,T,U Others Services $ 129,159,380.88
Total GDRP $ 15,009,811,163.77

In the table, it is known that the top 10 contribution of sector to GDRP. The spread of sector contribution
to GDRP is taken only the top 10 with the assumption that the ten sectors have a high potential in
Lampung Province. Results Sorting sector by percentage of sector revenue contribution to total revenue
of Lampung Province Region. Of the ten sectors found that the agricultural sector, processing industry,
and trade occupy the top 3 with the percentage of contribution to Lampung province more than 10%.
This indicates that these sectors have a major impact on the economic progress of Lampung Province
and need to be further developed. To use Location Quotient research method the authors also need local
GDRP data or GDRP from one of the districts contained in Lampung Province. With so needed GDRP
data from the area that will be carried out the development of the Natar region contained in South
Lampung District. Designed development concept will be implemented at Radin Inten II Airport located
in South Lampung District, so it needs GDRP area of South Lampung District, Here is the data of GDRP
of South Lampung District in the following table,
Table RESULTS AND DISCUSSION.2 South Lampung District GDRP Sector Distribution

GDRP of South Lampung District at 2010 Constant Market Prices

Industrial Origin 2015
A Agriculture, Livestock, Foresty, and Fishery $ 568,689,204.84
B Mining and Quarrying $ 29,134,439.18
C Manufacturing $ 448,336,884.07
D Electricity and Gas $ 2,318,325.43
E Water Supply $ 2,263,499.59
F Construction $ 202,881,012.56
G Wholesale and Retail, Car and Motorcycle Reparation $ 231,046,565.86
H Transportation and warehousing $ 105,095,396.07
I Accomodation and Food and Beverage $ 23,538,809.90
J Information and Communication $ 61,432,505.83
K Financial Services $ 32,869,374.86
L Real Estate $ 43,983,374.71
M,N Business Services $ 1,615,692.47
O Government, Defense, and Social Assurance $ 37,182,464.45
P Education Services $ 43,044,421.88
Q Health Services and Social Activity $ 10,371,676.82
R,S,T,U Others Services $ 10,907,733.39
Total GDRP $ 1,854,711,381.93

In the table, it is known that the contribution of sector to GDRP. Results Sorting sector by percentage of
sector revenue contribution to total revenue of Lampung Province Region. Of the ten sectors found that
the agricultural sector, processing industry, and trade occupy the top 3 with the percentage of
contribution to Lampung province more than 10%. This indicates that these sectors have a major impact
on the economic progress of Lampung Province and need to be further developed.
This is in accordance with the Main Performance Indicator of Lampung Province for the year 2015 until
2019. In Lampung Province IKU is from the first goal with a strategic target number 3 which states,
increased growth and the contribution of the manufacturing sector to Lampung Province Gov. (Decision
of Lampung Governor, 2014 ). Increasing the Quantity and Quality of Basic Infrastructure, Facilities and
Utilities with reliable and qualified water resources to meet domestic, agricultural (irrigation), industrial
and other needs both now and in the future. As well as increasing service coverage and quality of energy
infrastructure and electricity in Lampung Province. The following is a description of sub-sectors of each
selected potential sector,
Table RESULTS AND DISCUSSION.3 Results of Location Quotient Method

No Priority Industries LQ Ratio

1 Manufacturing 1.342998162
2 Elictricity and Gas 1.223311359
3 Water Supply 1.21344653
3.1.2 Analysis of GDRP Distribution
After it was found that from the sector of GDRP that will be developed further is a sector of processing
industry. From processing of distribution analysis of sub sector to sector in GDRP also found that sub
sector of food and beverage processing industry which occupy first position with big contribution of
46.6% from all sub sector contribution to processing industry sector in South Lampung Regency. The
next step is to determine the type of food and beverage industry that will be developed further and
applied in the concept of Aerotropolis Radin Inten II Airport Lampung Province.
Table RESULTS AND DISCUSSION.4 Result of GDRP Distribution Analysis
No Category Distribution (%) GDRP Level
1 Manufacturing 23.14 GDRP Sector
2 Food and Beverage Industry 46.6 GDRP Sub Sector

The following is a list of 6 selected food and beverage industries to be developed further in the
Lampung Aerotropolis District.
Table RESULTS AND DISCUSSION.5 Food and Beverage Industry

Areas Production
No Industries Productivity Year Source
(Ha) (Ton/year)
2015 Lampung Province
1 Cassava Starch 304,470 8,034,020 26.39 2014
Statistic - BPS
2015 Lampung Province
2 Corn Ethanol 338,885 1,719,390 5.07365 2014
Statistic - BPS
2016 Indonesia Holticulture
3 Sugar 121,434 777,113 6.399468024 2016
Statistic
Canned 2014 Indonesia Holticulture
4 32,000 560,026 17.5008125 2014
Pineapple Statistic
Palm Cooking 2014 Lampung Province
5 209,758 440,412 2.09962 2013
Oil Statistic - BPS
2016 Indonesia Holticulture
6 Coffee Powder 162,070 108,983 0.672444006 2016
Statistic
The above list of industries is the result of a literature review of the potential of the food and beverage
industry in Lampung Province. The six industries are the food and beverage processing industry that
tops the list.
3.1.3 Plotting Area

Figure RESULTS AND DISCUSSION.1 Lampung Aerotropolis District Modelling

From the development concept, the total area of 1446.9 hectares of development land with the
distribution of land use as follows. The development of Radin Inten II Airport is carried out to airport
terminals, airport airport buildings, airport runways, and other components to be included in the
calculation of the investment cost of Radin Inten II Airport development. In the Radin Inten II airport
development plan developed for this research, the airport will be expanded to a capacity of 30 million
passengers and 2.7 million tons of cargo with 2 runways and a total terminal area of 625,000 m2. In the
design of the concept of Aerotropolis Airport Radin Inten II area mixed use area is divided into 2
different locations to level out the number of visitors Aerotropolis. In this area there are several sectors
of the region that is, residential area of 8-storey apartment with an area of 2000 m2 per floor. Then there
is also a commercial area of the mall or shopping center that stands with the number of 4 floors. There
are also office or business areas in the form of office buildings with the number of floors 20 and the
floor of each floor 1300 square meters. Next there is a hotel area with the form of a hotel building
building with the number of floors 8 on an area of 1000 m2. Not forgetting there is a green open space in
the form of a city park and transportation access in the form of a city highway with flexible pavement.
Processed products with total area for industrial area of 430.6 hectares are found. However, adjusting to
industrial regulations stating that industrial buildings should be included with green open space of 30%
of the total area, the total area used for the development of industrial estates to be 301.42 Hectares with
the description according to the above table.
Table RESULTS AND DISCUSSION.6 Lampung Aerotropolis District Region Developments
Development Components Areas (Ha) Land use (%)
Airpots Upgrade 770 53.21722303
Industry Region 430.6 29.76017693
Mixed Use Region 101.6 7.021908909
Supporting Infrastructure 144.7 10.00069113
Total 1446.9

3.2 Cost of Investment

The next step is to look for benchmarking on each development component to be processed data of
investment cost value from application of Aerotropolis concept at Radin Inten II Airport of Lampung
Province. To be able to make design concepts and minghitung investment costs required data -
comparison data first. Benchmarking is done to find out the modeling concepts that have been applied
and also the value of investment cost from the modeling.
Having found the value of Investment Costs of all components to be developed at Aerotropolis Radin
Inten II Airport, the next step is to attract the investment price to 2025 where by assuming in 2025 this
concept will be implemented. Each component has an investment cost value applicable to the price in
the year Which is different. Therefore the data needs to be inserted into the formula Time Value Of
Money for the value of the final investment cost in getting a list of investment costs in the same year.
The author targets the implementation of this Aerotropolis project in 2025. For further discussion will be
discussed in accordance with the development component.
Table RESULTS AND DISCUSSION.7Final Total Investment Cost of LAD
Cost of Lampung Aerotropolis District Development
(LAD)
Development Components Value Cost ($)
Industrial Region 1,278,015,227.32
Mixed Use Region 6,095,788,266.61
Geothermal Power Plant 383,338,227.37
Purified Water Treatment
36,403,848.98
Plant
Sewage Treatment Plant 13,400,985.38
Transportation Access Way 43,085,699.63
BRT 54,434,683.17
Airport Upgrades 5,635,613,082.48
Total Investment Cost of
13,540,080,020.93
LAD
 The table above shows the final investment cost of total investment cost of all components of development in
2025. The investment cost of the Aerotropolis concept at Radin Inten II Airport is $ 13,540,080,020.93.

4 CONCLUSION
From the data processing using location quotient and also distribution analysis of GDRP found some
sector that used to develop Radin Inten II Airport become Aerotropolis. From the processing it is found
that Aerotropolis is supported by a processing industry area of 430.6 hectares, mixed use area of 101.6
hectares, airport development with an area of 770 hectares, and additional infrastructure with an area of
144.7 hectares. The mapping is conducted on the basis of the regulations applicable in Indonesia , As
well as taking into account future developments.
The investment cost obtained from initial cost analysis and processing time value of money method
from Aerotropolis design concept development is $ 13,540,080,020.93 consisting of cost component in
each sector developed that is, processing industrial estate, mixeds use area, airport development, and
Supporting infrastructure.

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