Demand for Office Space In Jakarta Rises in Q2
Jakarta-based property consultancy PT Procon Indah said the office rental property market showed signs of improvement in the second quarter, while the retail property market, which usually spearheads recovery in the property sector after a downturn, was suffering from oversupply.
“Supported by increased confidence in the economy, the Jakarta office market has shown some positive signs during the second quarter of this year,” Utami Prastiana, Procon’s head of research, said on Tuesday.
Procon data showed that demand for office space increased by 1.3 percent, or 43,500 square meters, year-on-year in the second quarter, compared with an increase of 27,000 square meters in the first quarter. Supply increased 1.4 percent, or 53,000 square meters, to 3.92 million square meters in the three months through July.
Occupancy rates, however, remained stable at 86.6 percent.
Utami said Procon saw demand growing only modestly during the rest of the year.
“The Jakarta office market will be relatively stable in the second half of the year, but may further improve in 2010,” she said.
She said lease renewals would help keep the market relatively buoyant as many major rental agreements were due to expire in the near term.
Despite the large volume of new office space expected to open up on the market next year, occupancy levels would decline only slightly to about 85 percent, she said.
Meanwhile, a rebound in the retail property sector, Utami said, was still some way off because “there’s still quite an oversupply of retail space, while retailers are more cautious and selective about opening new stores.”
The retail occupancy rate declined just barely to 77.9 percent in the second quarter, from 78 percent during the year-earlier period.
Procon believes the occupancy rate in the retail property market will hover between 77 percent and 79 percent until the end of next year.
“Supported by increased confidence in the economy, the Jakarta office market has shown some positive signs during the second quarter of this year,” Utami Prastiana, Procon’s head of research, said on Tuesday.
Procon data showed that demand for office space increased by 1.3 percent, or 43,500 square meters, year-on-year in the second quarter, compared with an increase of 27,000 square meters in the first quarter. Supply increased 1.4 percent, or 53,000 square meters, to 3.92 million square meters in the three months through July.
Occupancy rates, however, remained stable at 86.6 percent.
Utami said Procon saw demand growing only modestly during the rest of the year.
“The Jakarta office market will be relatively stable in the second half of the year, but may further improve in 2010,” she said.
She said lease renewals would help keep the market relatively buoyant as many major rental agreements were due to expire in the near term.
Despite the large volume of new office space expected to open up on the market next year, occupancy levels would decline only slightly to about 85 percent, she said.
Meanwhile, a rebound in the retail property sector, Utami said, was still some way off because “there’s still quite an oversupply of retail space, while retailers are more cautious and selective about opening new stores.”
The retail occupancy rate declined just barely to 77.9 percent in the second quarter, from 78 percent during the year-earlier period.
Procon believes the occupancy rate in the retail property market will hover between 77 percent and 79 percent until the end of next year.