Property demand stronger during first quarter
Property demand stronger during first quarter
JAKARTA (JP): The Jakarta property market was stronger in this
year's first quarter and building start-ups in almost all real
estate sectors remained high despite the coming general election,
a property analyst said yesterday.
PT Procon Indah's senior technical consultant and Jones Lang
Wooton Asia's director, Phil Simpson, said the first quarter of
1997 saw new projects start in all property sectors.
Jones Lang Wooton's Susan Pranata said "the net take-up of
office space in the central business district during the first
quarter was 102,756 square meters, up 11 percent from the same
period last year".
In the retail market, net take-up was 50,365 square meters, up
30 percent on the same period last year, Susan said.
The analysts were speaking at the release of the company's
Jakarta property market outlook.
The report said 80 percent of the retail market's new supply
had been sold before the properties were built.
In the residential estate market, 10 new estates taking up
1,650 hectares were launched in Greater Jakarta over the last six
months.
The estates in the Cibubur-Cileungsi corridor were launched
earlier this year.
Net take-up of rental apartments was 972 units, up 136
percent.
The report said the financial and securities,
telecommunications and manufacturing sectors stayed the main
sources of demand.
Corporate tenants wanting to lease many units were also
prevalent.
An estimated 2,753 completed strata title apartments were sold
during the first quarter -- a 113 percent increase.
There was also a healthy absorption of 115 hectares of
serviceable industrial estate in Greater Jakarta, a 130 percent
rise.
Former PT Procon Indah technical advisor, Craig Williams, said
new taxes and not the general election were more likely to affect
property demand.
Previously, property consultant PT DTZ Debenindo's managing
director, Victor Chan, said the idea of uncertainty was caused
mainly by Western media reports and not supported by a sound
understanding of Indonesian politics.
Indonesia will hold the general election for its 500-member
House of Representatives in May.
The 1,000-member People's Consultative Assembly, which
includes all House of Representatives members, will elect a
president in March.
"Overall, with continuing healthy levels of economic growth
and direct investment in Indonesia, we predict that demand for
property will remain high during 1997," Simpson said.
With inflation under control, Bank Indonesia has been lowering
interest rates and in the last six months average deposit rates
have fallen by between 1 percent and 2 percent, while prime
lending rates have dropped by about 0.5 percent.
The report said the average office rental price was stable at
US$13.50 a square meter but the range of asking rents at several
premium quality buildings which will be completed in the next two
years rose from between $17 a square meter and $19 a square meter
to between $18 a square meter and $20 a square meter.
The average retail rental price for prime ground floor space
in primary and secondary locations was steady at $77.10 a square
meter and $51.40 a square meter a month respectively. (bnt/vin)