Fri, 08 Aug 2008
The Jakarta Post, Jakarta

Net take-up in 36 industrial estates in Greater Jakarta has doubled in the first semester from the previous period, a report by property consultant Procon Indah shows.

During the January-June period, 58.22 hectares of land were sold, pushing up land absorption in industrial estates in Jakarta, Tangerang, Bekasi, Karawang, Purwakarta, Serang and Bogor to 112.58 hectares -- the highest in two years.

Ringan Siregar, a Procon manager, said Wednesday demand came from both local and overseas investors. International investors were mostly from Japan, South Korea, India, Italy and Singapore.

"By sector, demand was mostly absorbed in such sectors as automotive, logistics, spare parts, consumer goods and metal," Ringan said, adding the slightly lower prices may have played a part in the high demand.

Selling prices in the period averaged Rp 418,506 (around US$45) per square meter, as against Rp 438,256 per square meter in the second semester of last year.

Of the seven cities, Bekasi sold the most land, totaling 67.9 hectares, the report said, despite land there being more expensive than in the other six cities.

Selling prices of land in Bekasi averaged Rp 533,009 ($57) per square meter. The cheapest was in Serang, averaging Rp 338,365 ($37) per square meter.

The report's findings should partly ease concerns over the impacts of the May fuel price increases on the country's real estate sector, including economic activities in industrial estates.

"Economic variables such as the fuel price rises and currency fluctuations are expected to result in only temporary impacts on demand for industrial land in general," it said.

Turning to the second half of the year, Ringan said the outlook looked fairly good, with prices likely to remain stable and demand -- mostly from local businesses -- to stay active.

"The price average is estimated to remain stable, with changes to be caused only by the fluctuation of the rupiah against the U.S. dollar," the report said.

It revealed also that previous data show local investors tend to actively look for small and medium-sized blocks of industrial land, while foreign investors seek land on a larger scale.

For 2009, demand for industrial land may be especially high in Bekasi, Karawang and Purwakarta in relation to plans to construct a turnpike connecting Cikarang and Tanjung Priok.

Cumulative land supply in the seven industrial estates as of the end of June stood at 7,549.4 hectares. (ewd)



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