Occupancy rate of shopping centers down
Occupancy rate of shopping centers down
Sari P. Setiogi, The Jakarta Post, Jakarta
The occupancy rate for shopping centers in the Greater Jakarta
area declined in the forth quarter of 2002, as the market showed
some signs of oversupply, consultancy firm PricewaterhouseCoopers
(PwC) said on Thursday.
The decline might also signal that consumer spending, which
has been the main engine of economic growth over the past several
years, is slowing, it said.
"The occupancy rate declined by 1.4 percentage points to 92.2
percent, although the retail sector itself was still the
strongest sector last year," PwC's vice president director for
the property group, Dian Pradipta, said.
She predicted the declining trend would persist in the coming
years as more new retail space came onto the market despite the
apparent oversupply, and as the prolonged economic crisis and
inflation further dragged down consumer spending.
"We predict the market will be oversupplied in the next one or
two years, while the occupancy rate will drop below 75 percent,"
Dian said.
PwC's retail property manager, Sari Wulaningsih, said the
favorite shopping centers remained those located the capital's
prime areas, such as Plaza Senayan, Plaza Indonesia and Pondok
Indah Mall.
"The occupancy rates for these locations reached almost 100
percent. Maybe because the consumer spending of those who go (to
these shopping centers) has not been very much affected by the
prolonged crisis or inflation," she said.
Sari said the supply of new retail space between 2003 and 2005
would reach 800,000 square meters, 80 percent of which would
either be sold under a strata-title scheme or leased on a long-
term basis.
In 2003 alone, about 300,000 square meters of new shopping
centers will be offered on the market, she said.
"One of them, which was just launched early this year, is the
Senayan Trade Center. There will also be the World Trade Center,
Mangga Dua, Plaza Kelapa Gading I, Plaza Ciputat, Plaza Eka Loka
Sari and most likely Plaza Indonesia III," said Sari.
Sari said projects that offered space on the basis of long-
term leases had better prospects than strata-title projects.
"Occupancy rates for shopping centers for lease will remain
high, while strong take up of the new strata projects may be
lacking, since many of the buyers are only investors and not end-
users," Sari said.
The existing shopping centers in Greater Jakarta have a
combined space of about 1.556 million square meter. About 1.35
million square meters are leased, while 216,000 square meters are
strata-titled, she said.
In the forth quarter of 2002, three new shopping centers
entered the market: Cilandak Town Square (South Jakarta), Kelapa
Gading Mall III (North Jakarta) and ITC Kuningan (South Jakarta).