Retail market books positive growth<\/p>\n
JAKARTA (JP): The retail market in Jakarta recorded positive
\ngrowth in the first quarter of this year, indicating that the
\ncrisis in this property subsector has bottomed out, according to
\nproperty consultant Procon Indah\/Jones Lang LaSalle.<\/p>\n
Nevertheless, Procon Indah projected overall demand for retail
\nspace for the whole year of 1999 would continue to decline due to
\nlingering political uncertainties centering around the general
\nelection next month and presidential election in November.<\/p>\n
Procon Indah's research head Bayu Utomo said on Thursday that
\noccupancy rates in Jakarta's prime and secondary retail spaces
\ngrew by 2.5 percentage points to 82.8 percent in the first
\nquarter of 1999.<\/p>\n
The main driver of the increasing demand for retail space in
\nthe quarter was the stabilizing rupiah, which boosted consumer
\nconfidence, Bayu said.<\/p>\n
Stores in popular shopping centers recorded a 10 percent to 15
\npercent increase in sales in the first quarter, from the last
\nquarter in 1998, he said.<\/p>\n
\"The stabilizing rupiah plays an important role in driving
\nconsumer confidence. Once the rupiah drops again, the retail
\nmarket will also drop.\"<\/p>\n
The rupiah has been stable at around 8,500 against the U.S.
\ndollar in the first quarter of 1998. Currently the rupiah is
\ntrading at 8,000 to the dollar.<\/p>\n
Demand for retail space in Jakarta's prime and secondary areas
\ngrew by 27,800 square meters in the first quarter, after
\ndeclining by 157,000 square meters through the whole year of
\n1998.<\/p>\n
The growth in demand was somewhat misleading, however, as the
\nopening of Hypermarket Continent at MegaMall Pluit in March
\ncontributed more than 50 percent of retail take-up in the first
\nquarter.<\/p>\n
Rental rates for retail space remained stable in the quarter,
\naveraging US$48.80 per square meter per month for space in prime
\nlocations and $35.00 for space in secondary locations.<\/p>\n
Nevertheless, some owners of shopping centers in prime
\nlocations increased their dollar-rupiah conversion rate from
\nbetween Rp 2,700 and Rp 3,000 per U.S. dollar to Rp 3,500 per
\ndollar.<\/p>\n
However, Procon Indah projected that owners would be forced to
\ncut back rates or even the rental rates in the coming quarters
\ndue to major political events, which would force tenants to
\ntemporary close or even relocate their shops.<\/p>\n
Procon Indah predicted that retail space occupancy rates would
\ndrop again to 78 percent by the end of 1998.<\/p>\n
Demand for retail space would rebound again in 2000 after a
\nnew government is in place.<\/p>\n
Occupancy rates are projected to improve when economic
\nrecovery proceeds under the new government. (rid)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/retail-market-books-positive-growth-1447893297",
"image": ""
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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