Developers upbeat about high demand<\/p>\n
JAKARTA (JP): Developers remain optimistic about high level
\ndemand in the property market due to high economic growth and
\ninvestment commitments, Craig Williams, Senior Technical Advisor
\nto PT Procon Indah, said.<\/p>\n
\"As demonstrated historically, the two economic indicators --
\nhigh performance level of economic growth and investment
\ncommitment -- have a strong correlation with demand for various
\nproperty sectors,\" Williams, who is also managing director of
\nJones Lang Wootton Pacific, said here yesterday upon releasing a
\nquarterly report on the property market outlook.<\/p>\n
Procon Indah is a property research and consultancy company in
\nassociation with Jones Lang Wootten.<\/p>\n
The government has revised the target for national economic
\ngrowth to 7.1 percent per year during the 1994-1999 period.
\nMeeting the target will require a total of nearly US$400 billion
\nin investment over the entire period.<\/p>\n
This year seems to be bringing another success for the
\ninvestment coordinating board with high levels of investment
\napprovals.<\/p>\n
Foreign investment commitments in the first eight months
\nreached $30 billion, which surpassed the total for the whole of
\nlast year by 26.3 percent. Domestic investment commitments
\nreached Rp 43 trillion ($18.8 billion) during the same period, or
\n80.5 percent of last year's total.<\/p>\n
A director of Procon Indah, Susan Pranata, said that the
\ndemand remains high for the Jakarta office market in prime
\nlocations.<\/p>\n
She said total net absorption during the first nine months of
\n1995 reached 163,200 square meters and the figure is likely to be
\nbetween 200,000 to 220,000 square meters for the whole year.<\/p>\n
The company's report stated that the average annual net demand
\nin the Jakarta central business district since 1990 has been
\nhigher than all other major cities in Asia.<\/p>\n
The Jakarta central business district covers Jl. H.R. Rasuna
\nSaid, Jl. Jendral Gatot Subroto, Jl. Jendral Sudirman and Jl.
\nM.H. Thamrin.<\/p>\n
Compared to other major cities in the region, Jakarta ranked
\nfirst in the average annual net demand for prime office space
\nduring the first nine months of the year with 163,200 square
\nmeters.<\/p>\n
The central business districts in Kuala Lumpur, Bangkok and
\nTaipei ranked second, third and fourth respectively in the same
\nperiod with a demand average of below 150,000 square meters,
\nwhile the averages of Hong Kong and Singapore were below 5,000
\nsquare meters.<\/p>\n
The company's senior manager of research development, Bayu
\nUtomo, said that the largest demand for office buildings came
\nfrom the banking and finance sectors, at 32 percent,
\nmanufacturing 18 percent, business services 16 percent and
\ntrading 15 percent.<\/p>\n
Occupancy<\/p>\n
Susan said that the average physical occupancy improved by
\nalmost two percent over the last quarter to 93 percent as of
\nSeptember.<\/p>\n
The average rental levels range from US$14 to $16 per square
\nmeter per month for high quality buildings and $10 to $12 per
\nsquare meter for standard quality buildings, excluding service
\ncharges of between $6.50 to $7.50 per square meter.<\/p>\n
The office market in secondary locations, in the outskirt
\nareas, is seeing continuing strong demand, with almost 90,000
\nsquare meters within the first semester.<\/p>\n
The average occupancy level of the retail sector remained high
\nat over 90 percent despite the entrance of a large amount of
\nspace during the period.<\/p>\n
In the residential estate market, the report shows that
\ncurrent house purchasers are mostly end users. The number of
\ninvestors or speculators buying houses has declined due to high
\ninterest rates and the high level of supply.<\/p>\n
The rental apartment market in the third quarter of 1995
\nregistered a net take-up of 435 units, 30 percent higher than the
\nprevious quarter. During that period, an additional 400 rental
\napartments and condominiums were added to the market, increasing
\nthe total stock of multi-family housing to 6,353 units as of
\nSeptember.<\/p>\n
The report's analysis on the condominium situation indicates
\nno real change prices, although the Procon Indah research has
\nconfirmed cases of lower achieved prices being transacted.<\/p>\n
Home financing rates, which rose to 22 percent from 15 percent
\na year ago, have had an adverse impact on the market, the report
\nsaid. (kod)<\/p>",
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