Apartment supply expected to jump by 183% this year<\/p>\n
JAKARTA (JP): Jakarta's apartment market will be heavily
\noversupplied this year because the number of apartments will jump
\n183 percent to almost 33,600 units this year, property consultant
\nColliers Jardine said yesterday.<\/p>\n
The head of Colliers Jardine's research department, Evelyn
\nKhoo, said that as of February, the number of apartments
\nincreased 4.7 percent or 551 units to 12,426 units.<\/p>\n
\"We expect more than 20,000 units will be completed this
\nyear,\" she said.<\/p>\n
She said most of the new apartments would be small because
\ndevelopers were targeting the lower end of the market to combat
\nweakening demand.<\/p>\n
She said that as of February the average occupancy rate of
\nstrata apartments, which make up 67 percent of all apartments,
\ndropped about one percent to 50 percent.<\/p>\n
Last year the occupancy rate rose 3.7 percent from 47.3
\npercent to 51 percent.<\/p>\n
The average occupancy rate of rental apartments, which make up
\n20 percent of all apartments, fell five percent from 93 percent
\nlast year.<\/p>\n
Occupancy rates in serviced apartments, which make up 13
\npercent of all apartments, dropped from 85 percent to 80 percent.<\/p>\n
She said rent prices in secondary areas were generally US$14 a
\nsquare meter, while those in primary areas ranged between $17 a
\nsquare meter and $39 a square meter.<\/p>\n
The firm's chairman, Trevor J. Peach, said government
\nregulation No.41\/1996, which allows foreigners to buy property,
\nhad not yet created a sizable demand from foreign buyers.<\/p>\n
\"I notice from my own experience that foreigners are
\ndiscouraged by an unclear criteria of foreigners eligible to buy
\nproperty here,\" he said.<\/p>\n
He said foreigners were also discouraged because their
\nownership was restricted to property built on land with a right
\nof use title, which is valid for only 25 years with the
\npossibility of a 25-year extension.<\/p>\n
He said that because local people owned the property in
\nIndonesia under the title of the right of building, foreigners
\nwanting to buy would have to change it first into the right of
\nuse title. \"This is another obstacle,\" he said.<\/p>\n
Khoo estimated total office space would rise 18.4 percent to
\n3.8 million square meters this year, retail supply 17.62 percent
\nto 2,003,000 square meters and hotel rooms 41 percent to about
\n21,200 rooms.<\/p>\n
She said the total land zoned for industrial estates in West
\nJava was 12,079,600 hectares. Of this only 9,073 hectares has
\nbeen developed. About 2,800 hectares of the developed land is in
\nJakarta.<\/p>\n
\"I expect more companies will come to the industrial estates
\nbecause of lower costs and the government's policy which
\nencourages them to enter the estates,\" she said. (bnt)<\/p>",
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