Demand for office space doubles in CBD
Demand for office space doubles in CBD
Abdul Khalik, The Jakarta Post, Jakarta
Accelerated economic growth nearly doubled the demand for office
space in the Central Business District (CBD) in the first half of
the year, making it the highest demand recorded in seven years.
Chicago-based property consultant Jones Lang LaSalle said in
a report that property owners in the CBD -- locally known as the
Golden Triangle, which stretches along Jl. Jend. Sudirman, Jl.
MH Thamrin and Jl. Rasuna Said -- rented out a total of 60,000
square meters (sqm) of office space in the first semester, almost
double the 30,700 sqm leased in the corresponding period last
year.
Total take-up of office space citywide reached 2,440,000 sqm
in the first six months, or 79 percent of the total stock of
3,105,000 sqm.
"The high demand has been generated by banking and
telecommunications companies, which have been very busy expanding
their businesses in the first semester," Jones Lang LaSalle's
country head, Robin Holdsworth, told reporters on Monday.
He said that the banking sector, especially the consumer
banking and credit card divisions, had been growing fast while
the telecommunications sector, particularly cell phone operators,
continued to expand.
Jones Lang LaSalle also noted in its report that the high
demand was driven by a favorable economic performance, indicated
by encouraging gross domestic product (GDP) growth in the first
half, which reached 5.5 percent compared to only 4.4 during the
same period last year.
"Investment also grew by 13 percent, while exports grew by 7.3
percent. Optimism over the economy is also shown by the fact that
investment approvals rose by 71 percent to US$5.93 billion this
year," said Anton Sitorus, the company's research manager.
Demand for office space outside the CBD has also increased as
some companies moved part of their operations to other parts of
Jakarta.
Holdsworth said that many banks had decided to move their
back-office operations to other areas in Greater Jakarta to
reduce costs.
"The office space market in South Jakarta has been
experiencing similar growth in demand to that in the CBD. Other
areas have seen less growth," he said.
However, Holdsworth was unable to precisely predict the impact
of the recent slump in the rupiah -- which on Tuesday was trading
at Rp 10,525 per dollar -- as it was still too early to say.
"If the trend continues for more than six months, then it will
have a bad impact on the property business. Right now, however,
none of our clients have pulled out of deals," he said.
Jones Lang LaSalle also noted that stable socio-political
conditions and continued economic growth had resulted in higher
hotel occupancy rates.
The firm's vice president, Djodi Trisusanto, said the occupancy
rate for five-star hotels increased to 46 percent in the first
six months of this year compared to the same period last year.
Abdul Khalik, The Jakarta Post, Jakarta
Accelerated economic growth nearly doubled the demand for office
space in the Central Business District (CBD) in the first half of
the year, making it the highest demand recorded in seven years.
Chicago-based property consultant Jones Lang LaSalle said in
a report that property owners in the CBD -- locally known as the
Golden Triangle, which stretches along Jl. Jend. Sudirman, Jl.
MH Thamrin and Jl. Rasuna Said -- rented out a total of 60,000
square meters (sqm) of office space in the first semester, almost
double the 30,700 sqm leased in the corresponding period last
year.
Total take-up of office space citywide reached 2,440,000 sqm
in the first six months, or 79 percent of the total stock of
3,105,000 sqm.
"The high demand has been generated by banking and
telecommunications companies, which have been very busy expanding
their businesses in the first semester," Jones Lang LaSalle's
country head, Robin Holdsworth, told reporters on Monday.
He said that the banking sector, especially the consumer
banking and credit card divisions, had been growing fast while
the telecommunications sector, particularly cell phone operators,
continued to expand.
Jones Lang LaSalle also noted in its report that the high
demand was driven by a favorable economic performance, indicated
by encouraging gross domestic product (GDP) growth in the first
half, which reached 5.5 percent compared to only 4.4 during the
same period last year.
"Investment also grew by 13 percent, while exports grew by 7.3
percent. Optimism over the economy is also shown by the fact that
investment approvals rose by 71 percent to US$5.93 billion this
year," said Anton Sitorus, the company's research manager.
Demand for office space outside the CBD has also increased as
some companies moved part of their operations to other parts of
Jakarta.
Holdsworth said that many banks had decided to move their
back-office operations to other areas in Greater Jakarta to
reduce costs.
"The office space market in South Jakarta has been
experiencing similar growth in demand to that in the CBD. Other
areas have seen less growth," he said.
However, Holdsworth was unable to precisely predict the impact
of the recent slump in the rupiah -- which on Tuesday was trading
at Rp 10,525 per dollar -- as it was still too early to say.
"If the trend continues for more than six months, then it will
have a bad impact on the property business. Right now, however,
none of our clients have pulled out of deals," he said.
Jones Lang LaSalle also noted that stable socio-political
conditions and continued economic growth had resulted in higher
hotel occupancy rates.
The firm's vice president, Djodi Trisusanto, said the occupancy
rate for five-star hotels increased to 46 percent in the first
six months of this year compared to the same period last year.