Many retailers opt for closure as purchasing power plummets<\/p>\n
JAKARTA (JP): An increasing number of retailers affected by
\nthe recent riots are expected to close their outlets as people's
\nbuying power continues to weaken.<\/p>\n
Bayu Utomo, the head of research at property consultancy PT
\nProcon Indah\/Jones Lang Wootton, said that due to declining
\nconsumer spending, more and more retailers are preferring to
\nclose outlets while waiting for the economic situation to
\nimprove.<\/p>\n
\"Many retailers selling imported goods, especially fashion
\ngoods, are likely to terminate operations in Indonesia,\" Bayu
\nsaid.<\/p>\n
The retail sector weakened significantly during the first 10
\nmonths of the monetary crisis and then deteriorated further in
\nthe wake of the recent political and social unrest, Bayu said.<\/p>\n
Damage to buildings during the May riots in Greater Jakarta
\nhas reduced retail space by approximately 280,000 square meters
\n(sq.m.), according to the consultancy.<\/p>\n
Bayu said a recent survey by his company showed that seven
\nretail centers in Jakarta, covering 122,000 sq.m. or
\napproximately 10 percent of the city's total retail center space,
\nwere looted, damaged or burnt and have been closed.<\/p>\n
The affected centers are Menteng Prada in Central Jakarta,
\nPlaza Central Klender and Plaza Jatinegara in East Jakarta, Plaza
\nKebayoran in South Jakarta, Mal Daan Mogot, Plaza Glodok and
\nPlaza Slipi Jaya in West Jakarta.<\/p>\n
The company said that rioters also destroyed five shopping
\ncenters with a total space of 158,000 sq.m. outside Jakarta. The
\nworst damage was in Tanggerang, where only Plaza Bumi Serpong
\nDamai and Plaza Tanggerang were unaffected.<\/p>\n
Shopping centers affected in Tanggerang include the Lippo
\nSupermall, Mal Permata Cimone, Toserba Sabar Subur, Mal Diamond
\nand Kota Belanja Cimone Indah.<\/p>\n
Greater Jakarta was paralyzed on May 13 and May 14 as
\nthousands of people damaged and burned thousands of buildings and
\nvehicles and looted the contents of the destroyed properties,
\nmostly malls.<\/p>\n
The Indonesian Retail Merchants Association (Aprindo) has
\nestimated that Indonesian retail stores in and around the capital
\nmay lose about Rp 600 billion (US$40 million) from the two days
\nof looting, rioting and arson. However, this tentative estimate
\ndoes not include business lost from subsequent closures.<\/p>\n
Utomo said that of the centers in Jakarta which were damaged
\nby the riots, only Menteng Prada has confirmed it is reopening,
\nin the third quarter of this year.<\/p>\n
\"Those gutted by fire will require six to 12 months for
\nreconstruction, although many are unlikely to commence repairs in
\nthe short term given the weak economic situation, unless full
\ninsurance payouts are forthcoming,\" Bayu said.<\/p>\n
Procon Indah's surveys show that some electronic retailers,
\nparticularly former occupants of Jakarta's electronics center in
\nGlodok Plaza, plan to reopen in neighboring shopping centers such
\nas Mal Mangga Dua, Dusit Arcade and Plaza Gajah Mada.<\/p>\n
Some are already fitting out new premises and are expected to
\ncommence trading within the next three months. (gis)<\/p>",
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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