Office rents fall 30 percent

Office rents fall 30 percent

JAKARTA (JP): Sharp competition in the office market has led
to a 30 percent drop in rental fees since 1991, research analysts
said.

Rudy Halim and Yuhal of the property consultancy PT Procon
Indah/Jones Lang Wootton said average monthly rents are currently
US$13 per square meter, Antara reported.

Rents in "Grade A" sites such as Jl. Sudirman are around
$14.20 per square meter per month. In "Grade C" sites, where
office areas are less strategic, monthly rents are $10.80 per
square meter.

Prime location rents last year increased five percent, while
secondary sites saw few significant changes, Yuhal said, adding
that rents in central business districts remained $2 higher than
those outside the districts.

Research conducted by the consultancy in April showed that the
amount of office space in the city has jumped to 2.23 million
square meters, a 6 percent increase since late last year.

Rudy said the increase was due to the completion of 127,480
square meters of new space in the central business district.

The new supply is from Plaza Bapindo II on Jl. Sudirman, Plaza
Great River on Jl. H.R. Rasuna Said, Adhi Graha on Jl.Jend. Gatot
Subroto, and Menara Imperium on Jl. H.R. Rasuna Said.

The research showed that Jl. Jend. Gatot Subroto had the
largest addition of office space, where supply increased 45
percent compared to last March. On Jl. M.H. Thamrin, office
supply has remained the same during the last 12 months.

Rented space of 5,000 to 8,000 square meters in the central
business district is reported to be in demand by foreign
countries.

Several foreign multinationals are pooling their companies
into single locations" for efficiency reasons, the study
reported.

Rudy explained that companies are beginning to be more
selective with their locations and will choose less expensive
sites if they feel secondary areas are good enough for their
operations. (anr)