Evaluating Land Use Policy Governance: Reformulating Apartment Development Priorities in Indonesia’s Investment Framework

Abstract

Indonesia continues to face a significant housing backlog amid rapid urbanization and increasing land scarcity, particularly in major urban areas where apartment development has become an important strategy for providing affordable housing. Despite the existence of Law Number 25 of 2007 on Investment, Law Number 20 of 2011 on Apartments, Government Regulation Number 12 of 2021, and Presidential Regulation Number 38 of 2015, the current regulatory framework remains fragmented and insufficient to prioritize apartment development for low-income communities. This study aims to analyse the regulation of apartment development within Indonesia’s investment legal framework and formulate a legal reform model capable of prioritizing sustainable vertical housing development. This research employs a normative juridical method using statutory and conceptual approaches. The analysis is conducted through the combined framework of Lawrence M. Friedman’s Legal System Theory and Mochtar Kusumaatmadja’s Development Law Theory. The findings reveal fragmentation in legal substance, legal structure, and legal culture, resulting in weak integration between investment incentives, balanced housing obligations, apartment regulations, and public-private partnership mechanisms. To address these shortcomings, this study proposes a Social Housing Partnership Model based on Integrated Vertical Balanced Housing, which integrates investment incentives, social housing obligations, availability payment mechanisms, and contractual governance within a unified legal-commercial framework. The proposed model strengthens legal certainty, improves project bankability, enhances risk allocation, and expands access to affordable apartment housing for low-income communities.

Keywords

• Investment Law
• Social Housing Partnership
• Integrated Vertical Balanced Housing
• Affordable Housing