Research & Forecast Report Q1 2016
Jakarta Property Market Report
Accelerating success.
Highlight Office Sector During the quarter, the office market condition was relatively stagnant. The additional supply in the CBD will add 1.7 million sq m in 2016 – 2018 which is 15% lower than the office supply projected for the same period as of the end of last year due to delays in construction. As a result of several small leasing transactions, the occupancy level in the CBD dropped only 1% from the previous quarter and now stands at 88.6%. About 12 buildings reduced asking rents by 20% to 30% this quarter; however, average asking rent (for vacant office space) climbed moderately to IDR345,295 / sq m / month due to the influx of newly completed office buildings that quote higher rental rates.
Apartment Sector After having experienced dismal sales last year which were partially salvaged due to a lower than expected supply, the first quarter of 2016 witnessed 6,013 new apartment units coming from the completion of six projects. End-user buyers continued to absorb unsold units of existing projects reflecting a moderate increase in the take-up rate to 96.2% for such projects. However, sales of under construction projects dropped 1.7% QoQ to 67% this quarter. The average apartment price in Jakarta increased by 1.1% QoQ which was the lowest increment since Q3 2012. The average asking price in Jakarta was up slightly from IDR30.5 million last quarter to IDR30.8 million this quarter.
Retail Sector Thus far retail supply in DKI Jakarta remained at 4.45 million sq m as of Q1 2016, but the market anticipates four new shopping centres being completed in 2016. The occupancy level was
2
relatively flat QoQ and stood at 86.3%. The closure of several branded retailers in a shopping centre located in Jalan Satrio for example, characterized the slowing purchasing capacity. Despite sluggish leasing activities, average asking rents for vacant space in DKI Jakarta increased by 4.7% YoY to IDR545,968 / sq m / month as of Q1 2016 mainly triggered by several shopping centres that changed concept and tenancy mix.
Industrial Estate Sector Industrial land sales tapered off with most high performing industrial estates reporting that sales volume had ebbed compared with previous periods. Total land sales this quarter achieved 19.39 hectares, only 6% of the total sales 2015. In general, 62% of the total sales this quarter were concluded by logistics and automotive sector. Prices of industrial land only increased by 17% in the two main industrial estates in Serang as the result of good sales they recorded last year.
Hotel Sector A One Hotel (a 3 –star developed by the Cemara Group) which added 150 rooms to the market was the only hotel completed during the quarter. As of Q1 2016 the total hotel room supply for star rated and budget hotels was 42,014 rooms. The YoY overall occupancy in Jakarta area dropped quite significantly by 14.6%, putting the AOR at 49.5% - the lowest since 2013. In contrast with the AOR figure, hotels in Jakarta overall experienced a slight increase in ADR by 2.0% YoY by the end of Q1 2016 from USD80.59 to USD82.18. In the CBD, the ADR dropped slightly by 2.3% to USD120.28 and the ADR for hotels outside the CBD increased quite significantly by 5.9% to USD57.97.
Research & Forecast Report | Q1 2016 | Office | Colliers International
OFFICE SECTOR Office Spaces Offered For Lease Supply CBD
As mentioned earlier, some office buildings have rescheduled their completion dates to a year in the future. The downturn in economic growth, particularly in H2 2015, has had an impact on the construction progress of future office buildings. Some future office buildings have revised their completion dates. As of Q1 2016, it is expected that the additional supply in the CBD will reach 1.7 million sq m in 2016 - 2018. This is 15% lower than the office supply projections as of H2 2015.
CBD Office Cumulative Supply 7,500,000
6,000,000
4,500,000
sq m
3,000,000
1,500,000
2019F
2018F
2017F
2016F
2016YTD
2015
2014
2013
2012
2011
2010
0
Existing Supply
office building expected in 2016. In the same corridor, an office building called Gedung Hero will be demolished. The new landlord of this land will build a mixed-use development that is part of a plan to rejuvenate the area, particularly in the Gatot Subroto corridor. Centennial Tower only brought the cumulative supply in the CBD to 5.27 million sq m, increasing 7.7% YoY. In addition to Centennial Tower, two office buildings in Sudirman, namely Sinarmas MSIG and International Financial Centre 2, seem ready to begin operations soon.
Annual Supply
Source: Colliers International Indonesia - Research
Last year, eight office buildings began operations. More office buildings are expected to come onto the market based on their construction progress, bringing around 670,000 sq m of additional supply in 2016. Centennial Tower, an office building located at Gatot Subroto officially began operations in Q1 2016. It provides 100,000 sq m of semi-gross area and will be the largest
Despite the slowing economic growth, some future large-scale office buildings will be developed, particularly in Sudirman. The main corridor of Sudirman is still a magnet for developers and landlords to redevelop their properties. Developing infrastructure, such as the MRT (Mass Rapid Transit), which is planned for Sudirman, will bring more advantages. In line with the DKI Jakarta government increasing the plot ratio (KLB) for some areas near MRT stations, landlords of the land are permitted to increase their building size and height. Two office buildings located within the Dua Mutiara complex were demolished in 2015. As of Q1 2016, the developer is preparing the land to start construction of a future office building. Again, other existing small buildings will be rebuilt as high-rise office buildings in Sudirman. It is expected that a future office building (near the Benhil area) will provide around 100,000 sq m of additional supply in the CBD. We are also expecting construction to start on SSI Tower. This future office building is expected to bring around 80,000 sq m of additional office space at Rasuna Said. Apart from these office buildings, the developer of a Gani Djemat building has announced the development of another office building within their own complex around the Thamrin area.
Sudirman will continue to be the leading contributor of additional office supply in the CBD until 2019. Total future supply will be 2.1 million sq m by 2019 in the CBD and 42% of this additional office space will be in the Sudirman corridor. Around 880,000 sq m of the total projected additional supply contributed by 11 office buildings by 2019 will be in Sudirman, which is expected to gain 220,000 sq m of additional supply on average per year from 2016 to 2019. Most other areas are expected to only add from 65,000 to 70,000 sq m of office space per year from 2016 to 2019. Overall, the projected cumulative supply will grow almost 11% per year and reach 7.4 million sq m in 2019.
In the CBD, 77.8% of the cumulative supply is offices for lease as of Q1 2016. Gran Rubina and Sahid Sudirman Tower are office buildings for sale that began operations in the previous year. As mentioned above, Centennial Plaza is a recently opened stratatitle office building in the CBD. Most future strata-title offices for sale will be located in Sudirman, Mega Kuningan and Gatot Subroto. These three areas will contribute 75% of the one million sq m of projected office space for sale by 2019. Convergence (in the Rasuna Epicentrum Complex), Ciputra World Jakarta 2 and The Tower are upcoming strata-title office buildings that are expected to begin operations in 2016.
CBD Cumulative Supply Based on Area
Outside CBD Outside CBD Cumulative Supply
Satrio
2,500,000
Gatot Subroto Mega Kuningan
2,000,000
Rasuna Said
1,500,000
sq m
Sudirman
1,000,000
Thamrin 500,000 0
500,000
1,000,000 1,500,000 2,000,000 2,500,000 sq m
Existing Supply 2016
Future Supply 2016F - 2019F
0 2010
Source: Colliers International Indonesia - Research
2012
2014
Outside CBD excl. TB Simatupang
CBD Annual Supply Based on Marketing Scheme
2016YTD
2017F
2019F
TB Simatupang
Source: Colliers International Indonesia - Research
750,000
Three office buildings that were expected to start operations in 2015 rescheduled their completions. This caused the projected cumulative supply to increase by 9% YoY in 2016. Most of these future office buildings will be completed in H1 2016 and contribute 52.5% of the total future supply in 2016. West and South Jakarta will become the main areas, contributing 85% of the future supply in 2016. However, the cumulative supply was still 2.74 million sq m and there was no additional office space in Outside the CBD as of Q1 2016.
600,000
450,000
sq m
300,000
150,000
For Sale
2019F
2018F
2017F
2016F
2016YTD
2015
2014
2013
2012
2011
2010
0
Apart from the supply in 2016, most future office buildings in Outside the CBD are in the planning stages. Most recently, Agung Sedayu Group announced the development of office buildings at their prestigious projects in Kemayoran, Central Jakarta (Menara Jakarta) and Fatmawati, South Jakarta (Throne). These office buildings are expected to be completed after 2018.
For Lease
Source: Colliers International Indonesia - Research
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Research & Forecast Report | Q1 2016 | Office | Colliers International
Outside CBD Annual Supply
Cumulative Office Supply in TB Simatupang 1,200,000
300,000
1,000,000
250,000
800,000
200,000
600,000
Outside CBD excl. TB Simatupang
Existing Supply
TB Simatupang
2019F
2018F
2017F
2016F
2016YTD
2015
2014
2013
2010
2019F
2018F
2017F
2016F
2016YTD
2015
2014
2013
0
2012
0
2011
200,000
2012
400,000
50,000
2010
sq m
100,000
2011
sq m
150,000
Annual Supply
Source: Colliers International Indonesia - Research
Source: Colliers International Indonesia - Research
Throne Towers (at Fatmawati City Centre, South Jakarta), mentioned above, are future office buildings in TB Simatupang. After the huge supply in 2015, the additional office space seemingly will increase moderately until 2019 in TB Simatupang. As of Q1 2016, the cumulative supply was 833,899 sq m in TB Simatupang. Expecting around 270,000 sq m of additional supply, the projected cumulative supply will increase 8% per year until 2019.
New Supply Pipeline projected completion
Office building projects name
location
SGA* (sq m)
Marketing scheme
status development
CBD 2016
Sinarmas MSIG
Sudirman
75,000 For Lease
Under Construction
2016
Telkom Landmark Tower II
Gatot Subroto
65,000
For Lease
Under Construction
2016
Convergence
Rasuna Said
36,367
For Lease & Sale
Under Construction
2016
International Financial Centre 2
Sudirman
50,000
For Lease
Under Construction
2016
Capital Palace
Gatot Subroto
90,511
For Lease
Under Construction
2016
Menara Palma 2
Rasuna Said
50,000
For Lease
Under Construction
2016
Ciputra World Jakarta 2
Satrio
70,000 For Lease & Sale
Under Construction
2016
Satrio Tower
Satrio
31,604
For Lease
Under Construction
2016
The Tower
Gatot Subroto
56,492
For Sale
Under Construction
41,456
For Sale
Under Construction
2017
Menara Pertiwi
Mega Kuningan
2017
T Tower
Gatot Subroto
24,000 For Lease & Sale
Under Construction
2017
Lippo Thamrin Office Tower
Thamrin
16,500
For Sale
Under Construction
2017
Prosperity Tower @ District 8
Sudirman
71,545
For Sale
Under Construction
2017
Treasury Tower @ District 8
Sudirman
139,000
For Sale
Under Construction
2017
Office Tower Lot.10 SCBD
Sudirman
90,500 For Lease
Under Construction
2018
Mangkuluhur Tower
Gatot Subroto
53,000 For Lease & Sale
Under Construction
2018
Sopo Del Tower A
Mega Kuningan
80,000 For Lease & Sale
Under Construction continued
5
Research & Forecast Report | Q1 2016 | Office | Colliers International
New Supply Pipeline projected completion
Office building projects name
location
SGA* (sq m)
Marketing scheme
status development
continuation 2018
Sopo Del Tower B
Mega Kuningan
40,000 For Lease
Under Construction
2018
Sequis Tower
Sudirman
78,000 For Lease
Under Construction
2018
Sudirman 7.8
Sudirman
52,000 For Sale
Under Construction
2018
Tower Two at The City Center
Sudirman
101,260
For Lease
Under Construction
2018
World Trade Center III
Sudirman
70,000 For Lease
Under Construction Under Construction
2018
World Capital Tower
Mega Kuningan
72,000 For Lease & Sale
2018
Tower 2 @ Ciputra World Jakarta 1
Satrio
70,000 For Lease & Sale
Under Construction
2018
Astra Tower
Sudirman
80,000 For Lease
Under Construction
2019
Icon Tower
Sudirman
72,500 For Lease
Under Construction
2019
Thamrin Nine
Thamrin
97,500 For Lease
Under Construction
2019
Indonesia Satu
Thamrin
150,000
For Lease
Under Construction
2019
The Hundred
Mega Kuningan
45,000
For Lease
In Planning
2019
Chitaland
Satrio
90,000 For Lease
In Planning
2019
Plaza Gani Djemat 2
Thamrin
30,000 For Lease
In Planning
2019
Gran Rubina Tower 2
Rasuna Said
32,000 For Sale
In Planning
oUTSIDE CBD EXCLUDING TB SIMATUPANG 2016
ST Moritz Office Tower
Puri Indah
19,500
For Sale
Under Construction
2016
Puri Indah Financial Tower
Puri Indah
38,500
For Sale
Under Construction
29,000 For Sale
2016
Gallery West
Kebun Jeruk
2016
L'Office
Pasar Minggu
41,597
Under Construction
For Sale
Under Construction Under Construction
2016
Sky 18 Tower
Pasar Minggu
27,500 For Sale
2016
Soho Capital
Slipi
36,000
For Sale
Under Construction
2016
Altira
Sunter
40,000 For Sale
Under Construction
2016
Harton Tower
Kelapa Gading
8,000
For Lease
Under Construction
2016
Nariba Office Suites
Mampang
4,200
For Lease
Under Construction
2016
Tamansari Parama
Wahid Hasyim
10,800
For Sale
Under Construction
2016
One Belpark Office
Pondok Labu
17,800
For Lease
2017
Soho Pancoran
Pancoran
30,000 For Sale
Under Construction Under Construction
For Lease
Under Construction
2017
BKP Office Tower
Sunter
16,000
2017
Hermina Office Building
Kemayoran
20,000 For Sale
Under Construction In Planning
2017
Ciputra International Puri 1 Phase 1
Puri
15,000
2017
Ciputra International Puri 2 Phase 1
Puri
20,000 For Lease
For Lease
In Planning
2017
Ciputra International Puri 3 Phase 1
Puri
30,000 For Lease
In Planning
2017
MNC Tower II
Kebon Sirih
20,000 For Lease
In Planning
2017
Lippo Tower Holland Village
Cempaka Putih
27,000 For Sale
In Planning
2017
One Tower
Kemayoran
21,400
In Planning
For Sale
2017
Ciputra Business District Kemayoran Tower 1
Kemayoran
40,000 For Sale
In Planning
2017
Ciputra Business District Kemayoran Tower 2
Kemayoran
40,000 For Lease
In Planning
2018
Ciputra International Puri Phase 2
Puri
15,000
For Lease
In Planning
2018
Ciputra International Puri 1 Phase 3
Puri
15,000
For Lease
In Planning
2018
Ciputra Internatinal Puri 2 Phase 3
Puri
15,000
For Lease
In Planning
2019
Jakarta Box Tower
Kebon Sirih
36,000 For Lease
In Planning continued
6
Research & Forecast Report | Q1 2016 | Office | Colliers International
projected completion
SGA* (sq m)
Office building projects name
Marketing scheme
status development
continuation TB SIMATUPANG 2016
South Quarter Tower 3
2016
Zuria
40,778
For Lease
Under Construction
6,584
For Lease
2016
Under Construction
Cibis Tower
60,800
For Lease
Under Construction
2018
The Sima
60,000 For Lease
Under Construction
2018
Beltway Office Park Tower 4
30,839
In Planning
2019
Arkadia Tower G
30,000 For Lease
In Planning
2019
The Manhattan Square Tower 2
39,375
In Planning
For Lease For Lease & Sale
*SGA: Semi Gross Area Source: Colliers International Indonesia - Research
Demand
ago. A projected positive trend in economic growth is expected to increase the absorption of office space and occupancy rates. As an early indicator, Premium Grade office buildings showed an increase in occupancy since declining significantly as of Q1 2015.
CBD Occupancy Changes in the CBD Office Building Grade
Q1 2015
YoY
Q1 2016
QoQ
Q4 2015
All Classes
93.6%
88.6%
89.4%
Grade A
95.1%
84.7%
85.5%
Premium Classes
82.3%
89.4%
88.5%
Source: Colliers International Indonesia - Research
The expectation of a good level of occupancy in the CBD is currently very challenging, particularly amid the over-supply situation and relatively sluggish occupancy rate. The eight newly operating office buildings brought the occupancy down significantly in 2015. Although the real amount of additional office supply is less than the previous projection, the CBD will be expecting more upcoming office space and putting more pressure on projected occupancy rates in 2016. As of Q1 2016, pre-committed absorption for 2015 and 2016 reached around 150,000 sq m per year. In fact, the physical or real occupancy, particularly at newly operating office buildings, still showed a slowing increase. Several small space transactions helped maintain the occupancy at 88.6%. Regarding economic expectations, the government’s hefty spending and the inflow of private investment caused Bank Indonesia (BI) to forecast that the domestic economy will expand by 5.1 or 5.2% during the first two quarters of 2016. By year end, the Indonesian economy is expected to grow by between 5.2 and 5.6%. Both projections are higher than what was posted a year
7
The main thoroughfares like Thamrin, Sudirman and Rasuna Said maintained average occupancy rates of 90 - 92% QoQ. Mega Kuningan and Satrio showed higher growth in occupancy, while the occupancy of office buildings in Gatot Subroto showed quite a significant declining trend. The banking industry has characterised most of the leasing transactions and this had an impact on the occupancy rate, particularly in the Mega Kuningan and Satrio areas. In addition to the increasing amount of space occupied at newly operating office buildings, the relocation involving a large office space by Bank Tabungan Pensiunan Nasional (BTPN) to their new and owned building helped fuel the average occupancy rates in Mega Kuningan. The space left by BTPN at the previous building was acquired by a mining company after finishing their lease term at another office building. The Mega Kuningan area registered a QoQ increase in occupancy from 70 to 77% this quarter with vibrant leasing activities at some newly operating office buildings, despite the migration of Bank Danamon to their owned building located at Jalan Rasuna Said. Leaving a spacious vacant space in the current market condition has caused the landlord to consider lowering the asking rents since 2015. The occupancy rates in the Jalan Dr. Satrio area were underpinned by continued relocation of Bank Muamalat to the building named after their brand. The relocation of one prominent foreign bank will also occur at an office building in Jalan Sudirman. Nevertheless, these large vacant spaces have been anticipated by committed tenants ready to occupy them immediately.
Research & Forecast Report | Q1 2016 | Office | Colliers International
Average Occupancy Rates in The CBD
Average Occupancy Rates in Outside The CBD
100%
100%
98%
90%
96%
80%
94%
70%
92%
60%
90%
50%
88%
40%
86%
30%
84%
20%
82%
10%
80%
0% 2012
2013 Premium
2014
2015
Grade A
2016YTD
2012
2013
2014
Grade A
All Classes
2015
2016YTD
All Classes
Source: Colliers International Indonesia - Research
Source: Colliers International Indonesia - Research
Commitments to Space at Office Buildings in The CBD during 2015 - 2016
Since 2014, occupancy has been declining and dropped fairly moderaterly in the previous year in outside the CBD. The overall occupancy rate for outside the CBD was 88.4% as of Q1 2016, modest growth QoQ. A similar trend was seen at Grade A office buildings. Since occupancy dropped in 2015, the average occupancy at Grade A office buildings started climbing, albeit slightly, to 74.1% as of Q1 2016.
2016F
Most regions in outside the CBD had an average occupancy above 85%, except South Jakarta. As of Q1 2016, the occupancy in South Jakarta increased slightly QoQ to 84.4%. Some office buildings in Mampang, Cawang and Kebayoran currently have between 200 and 1,200 sq m of vacant space. One of the largest vacant spaces is due to the lease expiry of an insurance company. A major group of tenants will also leave a large vacant space at Mulia Business Park in mid-2016. Thus, the projected occupancy will likely be reduced in South Jakarta (not including part of South Jakarta in terms of the CBD area).
2015
0
75,000
150,000 225,000 300,000 375,000 450,000 sq m
Space Absorbed
Space Unabsorbed
Q1 2015
Source: Colliers International Indonesia - Research
Outside CBD
All Classes Grade A
Q1 2015
YoY
Q1 2016
QoQ
Q4 2015
90.9%
88.4%
87.9%
85%
74.1%
73.4%
Source: Colliers International Indonesia - Research
8
YoY
Q1 2016
QoQ
Q4 2015
Outside CBD - excluding TB Simatupang
93.6%
90.6%
90.5%
TB Simatupang
84.2%
83%
81.9%
Source: Colliers International Indonesia - Research
Occupancy Changes in the Outside CBD Office Building Grade
Occupancy Changes in the Outside CBD Based on Area
In other areas of outside the CBD, TB Simatupang had a gradually increasing occupancy rate since it decreased significantly in 2015. The occupancy was 82.9% in TB Simatupang as of Q1 2016, thanks to newly operating office buildings that showed increasing occupancy rates QoQ. However, TB Simatupang anticipates around 100,000 sq m of additional supply in 2016. Reportedly, those future office buildings still had low precommitted absorption as of Q1 2016.
Research & Forecast Report | Q1 2016 | Office | Colliers International
Commitments to Space at Office Buildings in outside The CBD in 2015 - 2016
2016F
Average Asking Rents in the CBD IDR400,000
USD40.00
IDR300,000
USD30.00
IDR200,000
USD20.00
IDR100,000
USD10.00
2015
30,000
60,000
Space Absorbed
90,000
120,000
Vacant Space
150,000
IDR
sq m
2015
2014
2012
2013
Aggregate
2016YTD
0
2011
USD0.00
2010
IDR0
USD
Source: Colliers International Indonesia - Research Source: Colliers International Indonesia - Research
As mentioned above, the projected occupancy performance will likely see a challenging situation in the Outside CBD. Of around 260,000 sq m of total additional office space for lease in 2015 2016, only 34% was absorbed as of Q1 2016. Most pre-committed absorption was contributed by office buildings that began operations in 2015. Further, 95.4% of the total pre-committed absorption during 2015 - 2016 occurred in future office buildings in TB Simatupang.
Asking Rents Average Asking Rents Based on Building Grade IDR500,000 IDR450,000
Decreasing occupancy rates as a result of slowing economic growth in the previous year caused some landlords to lower their asking rents this quarter. Currently, around 12 office buildings have reportedly decreased their asking rents by between 20 and 30% QoQ. However, based on vacant space calculations, average asking rent showed an increase QoQ. This was mostly contributed by newly operating office buildings in 2015 - 2016. Asking rents climbed moderately to IDR345,295 / sq m / month as of Q1 2016. Premium Grade office buildings also showed a soft increase in asking rents. Although an office building lowered its asking rent by 4.2%, the average rent for Premium Grade buildings was IDR478,470 / sq m / month as of Q1 2016. Projected asking rent is expected to maintain a slight increase in the two quarters ahead due to around 60% of the total future office space that will start operations in Q4 2016. The government, through Bank Indonesia (BI), has implemented the use of local currency for all property transactions since mid2015. Of course, landlords obeyed this regulation. However, with the current tight competition, these office buildings reduced their asking rents. At least 20 office buildings that previously used USD have lowered their asking rents considerably since they began using IDR currency. These office buildings are securing and maintaining occupancy rates against the current fluctuation of exchange rates.
IDR400,000 IDR350,000 IDR300,000 IDR250,000 IDR200,000 IDR150,000 IDR100,000 IDR50,000 IDR0 Premium
Grade A CBD
Grade B
Grade C
Outside CBD
Source: Colliers International Indonesia - Research
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Research & Forecast Report | Q1 2016 | Office | Colliers International
Range of Asking Rents in the CBD
As mentioned above, most of the decreased rent in outside the CBD was at office buildings in TB Simatupang. The average asking rent was IDR250,597 / sq m / month in TB Simatupang as of Q1 2016, which was a 10% decrease QoQ. Slowing absorption at existing and future office buildings is expected to have an impact on the overall asking rent projections in TB Simatupang. Currently, asking rents at future office buildings in TB Simatupang are between IDR260,000 and 280,000 / sq m / month.
IDR900,000
IDR750,000
IDR600,000
IDR450,000
Service Charges
IDR300,000
Range of Service Charges in the CBD IDR150,000
IDR140,000
IDR0
IDR120,000 Premium
Grade A
Grade B
Grade C IDR100,000
Source: Colliers International Indonesia - Research
IDR80,000
Average Asking Rents Outside the CBD
IDR60,000 IDR300,000
USD24.00
IDR250,000
USD20.00
IDR200,000
USD16.00
IDR150,000
USD12.00
IDR100,000
USD8.00
IDR50,000
USD4.00
IDR0
USD0.00 2012
2013
2014
2015
2016YTD
Outside CBD (IDR)
Outside CBD (Aggregate)
TB Simatupang (IDR)
Outside CBD (USD)
Source: Colliers International Indonesia - Research
Going ahead, landlords are generally expected to see quite a challenging situation in determining rents in 2016. Low occupancy rates at newly operating buildings and low absorption at future office supply will also put more pressure on asking rents in outside the CBD. It is also reported that asking rents at some future office buildings are already below the average market figure. As of Q1 2016, the average asking rent was IDR227,870 / sq m / month. Since the occupancy did not meet expectations due to tight competition in securing tenants, some newly operating office buildings lowered asking rents by as much as 20%. This situation caused the average asking rent to decrease by 4.4% QoQ. Based on building grade, the average asking rent at Grade A office buildings was IDR279,673 / sq m / month, 23% lower than in the CBD area.
IDR40,000 IDR20,000 IDR0 Premium
Grade A
Grade B
Grade C
Source: Colliers International Indonesia - Research
The average service charge was IDR79,447 / sq m / month in the CBD, while at Premium and Grade A office buildings it was IDR80,037 / sq m / month as of Q1 2016. In addition to those already operating, new larger office buildings also helped service charges increase by 2.9% QoQ. Around 25 office buildings increased their service charges by between IDR5,000 and 10,000. However, we still saw that some office buildings had service charges below IDR50,000 / sq m / month. Most of them are strata-title office buildings. Compared to the CBD, the average service charge was 25% lower outside the CBD. Up to 25% of the office buildings recorded service charges below IDR40,000 / sq m / month and 10% were above IDR80,000 / sq m / month. Higher service charges Outside the CBD are mostly at office buildings in South Jakarta. As of Q1 2016, the average service charge was IDR58,080 / sq m / month, an increase below 1% QoQ.
10 Research & Forecast Report | Q1 2016 | Office | Colliers International
Pre-Commitment Take-Up Rates Outside the CBD
Range of Service Charges Outside the CBD IDR140,000
2018F
IDR120,000 IDR100,000 IDR80,000
2017F
IDR60,000 IDR40,000
2016F
IDR20,000 IDR0
0 Outside CBD excl. TB Simatupang
50,000
100,000 150,000 200,000 250,000 300,000 sq m
TB Simatupang Space Absorbed
Source: Colliers International Indonesia - Research
Vacant Spaces
Source: Colliers International Indonesia - Research
The total projected additional office space for sale Outside the CBD is 50% less than that in the CBD area in 2016 - 2018. Outside the CBD will expect around 400,000 sq m of additional office space for sale by 2018. Up to 67% of the projected additional supply is expected in 2016. As of Q1 2016, the total of future office space for sale by 2018 has been absorbed at a rate of 65%. Most space absorbed was mainly from the office buildings open in 2016, which was 73% as of Q1 2016.
Strata-title Office Pre-Commitment Take-Up Rates in the CBD
2018F
Although the vacant space constituted less than 30% of the total space for sale by 2018, the growth of the average asking price for future strata-title offices was relatively flat QoQ. As of Q1 2016, the average asking price for future strata-title offices was IDR33.2 million / sq m, while the secondary market was between IDR36 and 60 million / sq m.
2017F
Average Asking Prices at New and Future Office Buildings
2016F
0
100,000
200,000
300,000
IDR60,000,000
400,000 sq m
Space Absorbed
IDR50,000,000
Space Unabsorbed IDR40,000,000
The absorption of office space for sale increased moderately QoQ. Apart from 2015, the average committed take-up rate only reached around 55% of the total office space for sale in 2016 2018. However, the commitment level for space absorbed at strata-title office buildings in 2016 has reached 75%. This current committed take-up rate level will make landlords confidentially maintain the asking prices high. Based on available space, the asking price at future strata-title office buildings was IDR52.2 million /sq m. On average, the asking prices at new and future office buildings have increased 30% since their launch three or four years ago. Available space in the secondary market has been offered for amounts between IDR40 and 95 million / sq m.
Price/sq m
Source: Colliers International Indonesia - Research
IDR30,000,000 IDR20,000,000 IDR10,000,000 IDR0 CBD
Outside CBD exclude TB Simatupang
Source: Colliers International Indonesia - Research
11 Research & Forecast Report | Q1 2016 | Office | Colliers International
TB Simatupang
Apartment Sector Apartment for Strata-title Supply After a dismal period last year with supply projections off the mark, the first quarter of 2016 witnessed 6,013 units of additional supply coming from the completion of six projects. This figure is almost double the supply in the same quarter last year and represents 22.6% of the total projected supply of 2016. Three of six newly completed projects this quarter, including Metro Park Residence, Kemang Village (Bloomington Tower) and Green Bay Pluit (Sea View) were previously expected to be
completed in 2015. Including the newly completed projects, the total of existing apartments in Jakarta has reached 162,920 units, increasing by 3.8% compared to the previous quarter and 21.96% YoY. The majority of unit supply this quarter were in West Jakarta that contributed 44.1% from the completions of Metro Park Residence and Madison Park, followed by Green Bay Pluit (Sea View) in North Jakarta with 34.5%. All in all, North Jakarta dominates the total existing supply with 22.6%, followed by West Jakarta and South Jakarta, with 21.8 and 19.9%, respectively. We revised our supply projections for 2016 - 2019 in the light of slow construction progress, delayed ground-breaking schedules and even development permit issues. We expect that the total supply during 2016 - 2018 will reach 75,083 units, down mildly by 3.2% compared to the previous projection of 77,549 units. Of the total 75,083 units, 26,583 units will be completed in 2016; 24,447 in 2017; and 24,053 in 2018.
Newly Completed Apartment Projects During Q1 2016 Name of development Metro Park Residence
location Kebon Jeruk
region West Jakarta
developer
units
Agung Podomoro Group
1,451 1,200
Madison Park
Tanjung Duren
West Jakarta
Agung Podomoro Group
Kemang Village (The Bloomington)
Jl. Pangeran Antasari
South Jakarta
Lippo Karawaci
150
Four Winds
Jl. Permata Hijau Raya No.1
South Jakarta
PT. Tri Tirta Permata
140
Green Bay Pluit (Sea View)
Jl. Pluit Karang Ayu
North Jakarta
Agung Podomoro Group
2,072
Bassura City (Tower Dahlia)
Jl. Basuki Rahmat
East Jakarta
Synthesis Development
1,000 Total
6,013
estimated price (idr/sq m)*
total Units
Source: Colliers International Indonesia - Research
Newly Introduced/Launched Projects During Q1 2016 Name of development
LOCATION
region
Expected completion time
The Residences at The St. Regis Jakarta
Jl. H.R Rasuna Said
CBD
2019
NA
164
Arandra Residence (phase 1)
Jl. Cempaka Putih Raya No.1
Central Jakarta
2020
23 million
368
Fatmawati City Center (Victoria Tower)
Fatmawati
South Jakarta
2020
36 million
622
Total
1,154
*Exclude VAT Source: Colliers International Indonesia - Research
12 Research & Forecast Report | Q1 2016 | Apartment | Colliers International
Location Distribution (Q1 2016)
of
Existing
West Jakarta 22.4%
Apartments
CBD 14.4%
Central Jakarta 13.5%
East Jakarta 7.5%
North Jakarta 22.4%
South Jakarta 19.8%
Source: Colliers International Indonesia - Research
January - March 2016 remained a quiet quarter with only three projects being introduced or launched. This represents only one-third of the amount in the same period of 2015. The recent declining sales performance has changed developers’ standpoint to focus on the selling out of unsold units rather than launching new products. Currently, the total number at new projects is 1,154 units expected to be completed in 2019 - 2020, ranging from the middle to luxury segments.
One of the newly launched projects is The Residences at The St. Regis Jakarta situated at the former location of the Four Seasons Hotel Jakarta for which Rajawali Group, as the landlord, has reached a management agreement with Starwood Hotels & Resorts Worldwide. As typical luxury apartments, The Residences apartments will be flanked by The St. Regis Hotel tower featuring a minimum of three-bedroom units ranging from 355 to 373 sq m (3 BR), 750 sq m (4 BR) and 1,250 sq m (Sky Palace). Another future apartment project is Arandra Residence, (previously the Sentosa Residence project and acquired by Gama Land from Bahama Group). This project, which will be located in the Cempaka Putih area, Central Jakarta, consists of five towers, with the first two towers (first phase) totalling 384 one-bedroom to three-bedroom units. As of February 2016, they still offer a Purchase Order Number or Nomor Urut Pembelian (NUP) with an average asking price of IDR23 million / sq m. In South Jakarta, Fatmawati City Center launched another tower, called Victoria Tower, which is expected to be completed in the next four years. More developers are becoming pragmatic over the current condition in which the market has reached a plateau. This is reflected in the limited number of projects being introduced or launched during the quarter. In general, apartment consumers still have a wait-and-see attitude. Despite generally declining apartment sales last year, however, the low to middle market segment saw better sales YoY last year, suggesting the idea that this market is widely acceptable even during strenuous times. The DKI Jakarta, on the other hand, focuses on sprucing up slum areas and converting them into low-cost apartments affordable by workers as well as widening the public, green, open space area.
New Pipeline Apartment name
location
region
developer
#units
Status
2016 The Grove (Empyreal + Masterpiece)
Jl. HR Rasuna Said
CBD
Bakrieland Development
438
Under Construction
The Residence (CWJ 2)
Jl. Prof Dr Satrio Kav 6, Kuningan
CBD
Ciputra Development
119
Under Construction
The Orchad Satrio (CWJ 2)
Jl. Prof Dr Satrio Kav 6, Kuningan
T - Plaza Residence (Tower A)
Jl. Penjernihan I Kav.1 Pejompongan
CBD
Ciputra Development
349
Under Construction
Central Jakarta
PT. Prima Kencana
307 Under Construction
Elpis Residence
Gunung Sahari
Central Jakarta
Sioeng Group
790 Under Construction
The Green Pramuka (Tower Orchid)
Jl. Jenderal Ahmad Yani
Central Jakarta
PT Duta Paramindo
1,000 Under Construction
The Green Pramuka (Tower Penelope)
Jl. Jenderal Ahmad Yani
Central Jakarta
PT Duta Paramindo
1,000 Under Construction
The Green Pramuka (Tower Scarlet)
Jl. Jenderal Ahmad Yani
Central Jakarta
PT Duta Paramindo
1,000 Under Construction
The H Residence Kemayoran (Amethyst)
Jl. Rajawali Selatan
Central Jakarta
Hutama Karya Realtindo
800 Under Construction
The Royal Springhill (Bouvardia Tower)
Jl. Spring Hill Residence Kemayoran
Central Jakarta
Springhill Golf Group
120 Under Construction
The Royal Springhill (Bulgari Tower)
Jl. Spring Hill Residence Kemayoran
Central Jakarta
Springhill Golf Group
192
Under Construction
Casablanca East Residence (2 Towers)
Jl. Pahlawan Revolusi
East Jakarta
Binakarya Propertindo Group
1,904
Under Construction
Bassura City (Tower Edelweiss)
Jl. Basuki Rahmat
East Jakarta
Synthesis Development
1,000 Under Construction
Bassura City (Tower Dahlia)
Jl. Basuki Rahmat
East Jakarta
Synthesis Development
1,000 Built continued
13 Research & Forecast Report | Q1 2016 | Apartment | Colliers International
Apartment name
location
region
developer
#units
Status continuation
Bassura City (Tower Cattleya)
Jl. Basuki Rahmat
East Jakarta
Synthesis Development
600 Under Construction
Bassura City (Tower Alamanda)
Jl. Basuki Rahmat
East Jakarta
Synthesis Development
600 Under Construction
Sentra Timur Residence (Tower Tosca)
Pulo Gebang
East Jakarta
Bakrieland Development
133
Teluk Intan (Tower Saphire)
Jl. Teluk Gong
North Jakarta
PT Trika Bumi Pertiwi
Pluit Seaview (Tower Belize)
Pluit
North Jakarta
Binakarya Propertindo Group
Green Bay Pluit (Sea View)
Jl. Pluit Karang Ayu
North Jakarta
Agung Podomoro Group
Senopati Suites 2
Jl. Senopati
South Jakarta
Mahkota Asia Graha
81
Under Construction
LA City Apartment (Tower A)
Jl. Raya Lenteng Agung, Jagakarsa
South Jakarta
Pancanaka Samaktha
980
Under Construction
Nine Residence
Warung Buncit
South Jakarta
Lippo Karawaci
246
Under Construction
La Venue - North Tower
Jl. Pasar Minggu
South Jakarta
PT Bintang Rajawali (Sinar Mas Group)
253
Under Construction
Kemang Village (The Bloomington)
Jl. P Antasari
South Jakarta
Lippo Karawaci
150
Built
Senopati Suites 3
Jl. Senopati
South Jakarta
Mahkota Asia Graha
1 Park Avenue (3 Towers)
Jl. KHM Syafi'I Hadzami (terusan gandaria)
South Jakarta
Intiland
Izzara Apartment (South and North Tower)
TB. Simatupang
South Jakarta
Grage Group
542
Under Construction
Apartment Pejaten Park Residence
Jl. Warung Buncit Raya No.21
South Jakarta
Bahama Group
560
Under Construction
Four Winds
Jl. Permata Hijau Raya No.1
South Jakarta
PT. Tri Tirta Permata
140
Built
Kebayoran Icon
Jl. Ciledug Raya
South Jakarta
Tamara Land
256
Under Construction
One Casablanca Residence
Jl. Pal Batu
South Jakarta
Forza Land
215
Under Construction
Grand Dhika Mansion Pejaten (Sector 1)
Jl. Siaga Raya
South Jakarta
Adhi Persada Property
44
Under Construction
Woodland Park (Mahogany Tower)
Jl. Pahlawan Kalibata
South Jakarta
PT. Pardika Wisthi Sarana
218
Under Construction
St Moritz (The New Ambassador Suite Tower)
Jl. Puri Indah Kembangan
West Jakarta
Lippo Karawaci
200 Under Construction
Metro Park Residence
Kebon Jeruk
West Jakarta
Agung Podomoro Group
1,451
St. Moritz (New Presidential Tower)
Jl. Puri Indah
West Jakarta
Lippo Karawaci
The Nest Apartment
Jl. Raden Saleh Raya, Meruya Utara
West Jakarta
PT. Karya Cipta Sukses Selaras
1,100 Under Construction
Green Park View (Tower Gardenia)
Jl. Daan Mogot
West Jakarta
PT. Inten Cipta Sejati, Cempaka Group
1,200 Under Construction
Belmont Residence (TowerAthena)
Jl. Meruya Ilir
West Jakarta
Gapura Prima
193
Puri Mansion Apartment (Tower Amethyst)
Jl. Lingkar Luar Barat, Puri Kembangan
West Jakarta
Agung Sedayu Group
900 Under Construction
Madison Park
Tanjung Duren
West Jakarta
Agung Podomoro Group
19 Avenue Apartment (Tower A)
Daan Mogot
West Jakarta
Margahayu Land
Paradise Mansion (2 Towers)
Jl. Paradise Boulevard Selatan
West Jakarta
Palm Group
Sudirman Suites
Jl. Sudirman
CBD
Pikko Group
380
Under Construction
Casa Domaine
Jl. Jend. Sudirman Kav 1
CBD
Lyman Group
186
Under Construction
Verde Two (Tower East)
Jl. Rasuna Said
CBD
Farpoint Realty
182
Under Construction
Anandamaya Residences (3 towers)
Jl. Jend Sudirman
CBD
Hongkong Land
500 Under Construction
Menteng Park
Jl. Cikini Raya No.79
Central Jakarta
Agung Sedayu Group
756
Under Construction
1,100 Under Construction 300 Under Construction 2,072 Built
54
Under Construction
279 Under Construction
159
Built Under Construction
Under Construction
1,200 Built 338
Under Construction
1,000 Under Construction
2017
Under Construction continued
14 Research & Forecast Report | Q1 2016 | Apartment | Colliers International
Apartment name
location
region
developer
#units
Status continuation
Holland Village
Cempaka Putih
Central Jakarta
Lippo Karawaci
400 Under Construction
Royal Suites
Kemayoran
Central Jakarta
Springhill Golf Group
The Green Pramuka (Tower Nerine)
Jl. Jenderal Ahmad Yani
Central Jakarta
PT Duta Paramindo
Green Signature Apartment
Jl. MT. Haryono
East Jakarta
KSO Fortuna Indonesia (Pikko)
Podomoro Park
Jl. I Gusti Ngurah Rai, Klender
East Jakarta
Agung Podomoro Group
Sentra Timur Residence (Tower Brown)
Pulo Gebang
East Jakarta
Bakrieland Development
Bassura City (Tower Jasmine)
Jl. Basuki Rahmat
East Jakarta
Synthesis Development
2,000 Under Construction
Bassura City (Tower Heliconia)
Jl. Basuki Rahmat
East Jakarta
Synthesis Development
700 Under Construction
Pluit Seaview (Tower Ibiza)
Pluit
North Jakarta
Binakarya Propertindo Group
500 Under Construction
Pluit Seaview (Tower Bahama)
Pluit
North Jakarta
Binakarya Propertindo Group
650
Under Construction
Regatta London Tower
Jl. Pantai Mutiara
North Jakarta
Intiland
186
Under Construction
Pakubuwono Terrace Grand Tower
Kebayoran Lama
South Jakarta
PT. Selaras Mitra Sejati
435
Under Construction
District 8 (Tower Eternity)
Jl. Senopati
South Jakarta
Agung Sedayu Group
400 Under Construction
District 8 (Tower Infinity)
Jl. Senopati
South Jakarta
Agung Sedayu Group
280 Under Construction
Lexington Rersidence
Pondok Pinang
South Jakarta
Cowell Development
275 Under Construction
The Aspen Peak at Admiralty (Tower C)
Jl. Fatmawati
South Jakarta
PT. Harmas Jalasveva
322 Under Construction
Sapphire Residence
Lebak Bulus
South Jakarta
PT. Bangun Lintas Shafira
La Terrasse
Jl. Deplu Raya No.12
South Jakarta
Cowell Development
111
Under Construction
The Foresque
Pasar Minggu, Ragunan
South Jakarta
PT Griya Karunia Sejahtera (Binakarya Propertindo Group)
660
Under Construction
The Langham Residences
Senopati
South Jakarta
Agung Sedayu Group
57
Under Construction
Antasari Heights (One Otium Residence)
Jl. Pangeran Antasari No.8
South Jakarta
PT Radinka Quatro Land
360
Under Construction
The Batik @ Pejaten
Jl. Siaga Raya
South Jakarta
Alam Kencana
137
In Planning
La Foret Vivante
Jl. Limo, Permata Hijau
South Jakarta
PT. Mahkota Properti Indo Permata
253
Under Construction
Selatan 8 (Tower Sultan)
Kebayoran Lama
South Jakarta
Karya Cipta Group
336
Under Construction
The Hamilton
Jl. KHM Syafi'I Hadzami
South Jakarta
Intiland
112
Under Construction
Puri Orchad (3 Towers)
Jl Raya Adicipta
West Jakarta
PT Adicipta Graha Kencana (Serenity Group)
Maqna Residence
Jl. Meruya Ilir No. 88
West Jakarta
PT. Graha Meruya
312
Under Construction
Veranda
Jl. Pesanggrahan Raya, Kembangan
West Jakarta
PT. Mutirara Puri Indah
174
Under Construction
Vittoria Residence (3 towers)
Jl. Daan Mogot
West Jakarta
PT. Duta Indah Kencana
Wang Residence
Jl. Panjang No 18
West Jakarta
PT. Citicon Propertindo
Taman Anggrek Residence (6 towers)
Tanjung Duren
West Jakarta
Agung Sedayu
19 Avenue Apartment (Tower B)
Daan Mogot
West Jakarta
Margahayu Land
416
Under Construction
Sycamore Suite
Puri Botanical, Joglo
West Jakarta
Jakarta Setiabudi International
125
In Planning
450
Under Construction
1,000 Under Construction 800 Under Construction 3,000 In Planning 605
Under Construction
37 In Planning
3,000 Under Construction
1,100 Under Construction 250 Under Construction 3,000 Under Construction
continued
15 Research & Forecast Report | Q1 2016 | Apartment | Colliers International
Apartment name
location
region
developer
#units
Status continuation
2018 Gayanti City (2 Towers)
Jl. Gatot Subroto
CBD
PT Buana Pasifik International
318
Under Construction
Verde Two (Tower West)
Jl. Rasuna Said
CBD
Lavie
Jl. Denpasar Raya
CBD
Farpoint Realty
152
Under Construction
Wilsor Group
302 Under Construction
South Hill
Jl. Denpasar Raya
CBD
KSO Duta Regency Karunia Metropolitan Kuningan Properti
611
Le' Parc
Jl. Thamrin
CBD
PT. Putragaya Wahana
100 Under Construction
Regent Residences (tower 1)
Semanggi
CBD
PT. Kencana Graha Global
100 Under Construction
The Hundred Residence
Mega Kuningan
CBD
PT. Farpoint Realty Indoneasia
100 Under Construction
The Elements Epicentrum (2 Towers)
Rasuna Said
CBD
Sinar Mas Land
372 Under Construction
Capitol Suites
Jl. Prapatan Raya
Central Jakarta
The Capitol Group
327 Under Construction
Holland Village (Phase II)
Cempaka Putih
Central Jakarta
Lippo Karawaci
230 Under Construction
Signature Park Grande
Jl. MT. Haryono
East Jakarta
KSO Fortuna Indonesia (Pikko)
Sahid Garden Residence
Ciracas
East Jakarta
Sahid Group
476
In Planning
Gold Coast Apartment (Atlantic Tower)
Pantai Indah Kapuk
North Jakarta
Agung Sedayu
568
Under Construction
Regatta Apartment (Tower New York)
Pantai Mutiara
North Jakarta
Intiland
186
Under Construction
Sedayu City (Tower Melbourne)
Jl. Pegangsaan Dua Raya
North Jakarta
Agung Sedayu
912
In Planning
Sedayu City (Tower Darwin)
Jl. Pegangsaan Dua Raya
North Jakarta
Agung Sedayu
936
In Planning
The Kensington Royal Suites (4 Towers)
Kelapa Gading
North Jakarta
Summarecon
790 Under Construction
Gold Coast Apartment (Bahama Tower)
Pantai Indah Kapuk
North Jakarta
Agung Sedayu
600 Under Construction
Gold Coast Apartment (Carribean Tower)
Pantai Indah Kapuk
North Jakarta
Agung Sedayu
600 Under Construction
Gold Coast Apartment (Honolulu Tower)
Pantai Indah Kapuk
North Jakarta
Agung Sedayu
600 Under Construction
Grand Marina Ancol
Ancol
North Jakarta
PT. Bangun Setia Cipta (Jaya Ancol)
672 In Planning
Bellevue Place
MT Haryono, Tebet
South Jakarta
Gapura Prima
240 Under Construction
The Aspen Peak at Admiralty (Tower D)
Jl. Fatmawati
South Jakarta
PT. Harmas Jalasveva
322 In Planning
Casa Grande Residence 2 (Tower Angelo)
Jl. Casablanca
South Jakarta
Pakuwon Group
350
Under Construction
Casa Grande Residence 2 (Tower Bella)
Jl. Casablanca
South Jakarta
Pakuwon Group
350
Under Construction
Casa Grande Residence 2 (Tower Chianti)
Jl. Casablanca
South Jakarta
Pakuwon Group
350
Under Construction
Pondok Indah Residences (3 Towers)
Pondok Indah
South Jakarta
Metro Pondok Indah
880
Under Construction
Selatan 8 (Tower Prabu)
Jl. Raya Ulujami
South Jakarta
Karya Cipta Group
344
Under Construction
45 Antasari (2 Tower)
Antasari
South Jakarta
Cowell Development
1,924
Under Construction
Arzuria Apartment
Jl. Tendean
South Jakarta
Tolaram Group
210 Under Construction
Pakubuwono Spring (2 towers)
Jl. Teuku Nyak Arief No.9
South Jakarta
PT. Simprug Mahkota Indah (Agung Podomoro Group)
545
Under Construction
Branz Simatupang (2 towers)
TB. Simatupang
South Jakarta
Tokyuland
381
Under Construction
Synthesis Residence Kemang (3 towers)
Jl. Ampera Raya No.17
South Jakarta
PT. Synthesis Development
Gianetti Apartment
Jl. Kebon Jeruk Raya, Kemanggisan
West Jakarta
Bangun Investa Graha
500 Under Construction
Gallery West
Jl. Panjang No 5
West Jakarta
AKR
280 Under Construction
Ciputra International Puri Indah (Tower Amsterdam)
Jl. Lingkar Luar Barat
West Jakarta
Ciputra
412
Under Construction
1,100 Under Construction
1,100 Under Construction
Under Construction continued
16 Research & Forecast Report | Q1 2016 | Apartment | Colliers International
Apartment name
location
region
developer
#units
Status continuation
Grand Madison Park
Tanjung Duren
West Jakarta
Agung Podomoro Group
Under Construction
Citra Lake Suites (Tower Rosewood)
Jl. Raya Kresek
West Jakarta
Ciputra Group
104
Under Construction
Citra Lake Suites (Tower Greenwood)
Jl. Raya Kresek
West Jakarta
Ciputra Group
126
Under Construction
Citra Lake Suites (Tower Oakwood)
Jl. Raya Kresek
West Jakarta
Ciputra Group
117
In Planning
Citra Lake Suites (Tower Sherwood)
Jl. Raya Kresek
West Jakarta
Ciputra Group
122 In Planning
Aerium Taman Permata Buana (2 towers)
Taman Permata Buana
West Jakarta
Sinar Mas Land and Itochu
491
In Planning
Ciputra International Puri Indah (Tower Barcelona)
Jl. Lingkar Luar Barat
West Jakarta
Ciputra
335
Under Construction
Puri Mansion Apartment (Tower Crystal)
Jl. Lingkar Luar Barat, Puri Kembangan
West Jakarta
Agung Sedayu Group
700 Under Construction
West Vista (2 towers)
Jl. Lingkar Luar Barat No.8, Duri Kosambi
West Jakarta
PT. Harapan Global Niaga
Citra Living Apartment (Somerset Tower)
Jl. Citra 7, Kalideres
West Jakarta
Citra Living Apartment (Orchad Tower)
Jl. Citra 7, Kalideres
West Jakarta
2,840
Under Construction
Citra Mitra Graha KSO
312
Under Construction
Citra Mitra Graha KSO
312
In Planning
Source: Colliers International Indonesia - Research
Demand The Jakarta apartment market has yet to change from the last quarter of 2015 and is still characterised by a slow take-up rate as a result of softening demand, particularly from investment buyers. In spite of the fact that the developers have offered attractive marketing gimmicks and flexible payment methods, demand has yet to grow noticeably. On the other hand, the existing apartment market performed fairly well QoQ as it seemed to be dominated by end-users for their own occupation. Overall, the average take-up rate for both existing and underconstruction apartments experienced a modest increase (less than 1%) compared to the previous quarter, from 85.4 to 86.2%.
Quarterly Take-up Rate Performance of Existing and Under-construction Apartments 100% 90% 80% 70% 60% 50%
Take-up Rate Changes of Existing and Underconstruction Projects Q1 2015
Q4 2015
Q1 2016
Existing Projects
95.7%
94.9%
96.2%
QoQ 1.3%
YoY 0.6%
Under-construction Projects
68.5%
68.7%
67.0%
-1.7%
-1.5%
Average
85.5%
85.4%
86.2%
0.8%
0.7%
Source: Colliers International Indonesia - Research
The QoQ take-up rate figures for the CBD and other non-prime areas experienced somewhat positive performance, while South Jakarta continued to see a downward trend due to massive additional supply, as this area has been the main location for apartment development. Since there is a limited number of newly launched apartments in the CBD, the market continues to absorb the unsold units from the existing under-construction projects, while the non-prime areas provide more apartment projects with affordable prices, thus capturing a wider market segment. The South Jakarta area recorded a declining take-up rate along with a continued increase in new apartment projects with higher prices, particularly projects having good building specifications located in areas with sound infrastructure.
40%
Take-up Rate in Jakarta
30% 20%
Q1 2016
Q4 2015
Q3 2015
Q2 2015
Q1 2015
Q4 2014
Q3 2014
Q2 2014
Q1 2014
Q4 2013
Q3 2013
Q2 2013
Q1 2013
Different
Locations
Q4 2015
Q1 2016
QoQ
YoY
95.6%
93.8%
94.0%
0.2%
-1.6%
South Jakarta
88.9%
86.6%
85.3%
-1.2%
-3.5%
Non-prime area
82.6%
83.7%
85.4%
1.7%
2.8%
CBD
Existing Projects
in
Q1 2015
10% 0%
Changes
Source: Colliers International Indonesia - Research
Under Construction Projects
Source: Colliers International Indonesia - Research
17 Research & Forecast Report | Q1 2016 | Apartment | Colliers International
In an attempt to rescue the property sector, the government has undertaken several measures, such as easing individual foreign ownership, giving tax incentives to Indonesian REITs, increasing Loan to Value ratio and increasing the threshold for the tax on luxury property. Since early this year, Bank Indonesia has gradually cut the benchmark rate by 75 basis points (bps) to 6.75%, which will help spur growth in the property industry. Along with the announcement, the Financial Services Authority (OJK) and Bank Indonesia also targeted the lending rate at below 10%. Those measures are a positive catalyst for the property sector, in the long run, particularly for the apartment market. Nevertheless, buyers may further delay their planned apartment purchases in the hope of lower lending rates in the future.
Average Prices in Three Different Areas Q1 2015
Q4 2015
Q1 2016
QoQ
YoY
CBD
IDR44,135,684
IDR47,250,375
IDR47,816,125
1.2%
8.3%
South Jakarta
IDR32,713,013
IDR35,430,002
IDR36,028,156
1.7%
10.1%
Non-prime Area
IDR21,285,155
IDR22,947,092
IDR23,147,612
0.9%
8.8%
Average
IDR28,442,570
IDR30,507,768
IDR30,840,637
1.1%
8.4%
Source: Colliers International Indonesia - Research
Another potential catalyst from the government to boost the property sector is the Tax Amnesty, despite the fact that, thus far, the House of Representative (DPR) has postponed discussion of the draft bill because they need more time to study it comprehensively. The Tax Amnesty scheme is likely to have a positive impact on the property market as it could increase capital inflow from repatriated funds that will be utilised to boost economic growth through higher capital expenditure and infrastructure spending. All in all, the property sector shows more confidence as the government continues to support the sector with regulations and policies. Nevertheless, it may take some time for the property market to benefit from the policies. Until all issues are cleared, we might not see any significant recovery in apartment demand.
Asking Price Overall, the asking prices of apartments in Jakarta have been flat. In the current soft market, developers tend to set the price carefully in order to maintain sales activity and to attract potential buyers. Landlords are generally still implementing traditional marketing methods, like offering incentives such as big discounts and flexible payments for serious buyers. Moreover, most developers offer 36 monthly instalments as their default plan, then come up with a raft of discounts, reducing the price as much as 20% through other promotions, without having to overtly slash the price. This kind of strategy is becoming popular as weak demand coincides with a surge in supply at new projects that were introduced or launched in 2015. As of Q1 2016, the average apartment price in Jakarta increased by 1.1% QoQ, the lowest increment since Q3 2012 at 0.7%. South Jakarta recorded the highest QoQ increase of 1.7%, followed by the CBD and Non-prime area (including West Jakarta, East Jakarta, North Jakarta and Central Jakarta) with 1.2 and 0.9%, respectively. The reason that the apartment prices in Jakarta never drop is that the market is mainly driven by investors rather than end-users. Thus, if the apartment prices remain flat for a long period, investors will start losing interest, as they are in the market looking for a good return on their investment.
18 Research & Forecast Report | Q1 2016 | Apartment | Colliers International
Apartment For Lease
expand their presence in Jakarta in the next four years with the development of Fraser Suites Jakarta at Ciputra World 2 (end of 2016), Fraser Residence Serenia Hills (2018), Capri by Fraser Simatupang (2018) and Fraser Suites Kebon Melati (2019).
Supply In the first quarter of 2016, there was only one serviced apartment project being completed, namely Fraser Place Setiabudi Jakarta. This new serviced apartment building features 151 one-bedroom to three-bedroom units. With the opening of this project, the total supply of apartments for lease increased by 1.7% to 8,780 units. This newly operating apartment building continues to demonstrate that South Jakarta remains a favourite location (35%) for serviced apartments after the CBD (44.6%) Fraser Place Setiabudi is the third serviced apartment project managed by Frasers Hospitality after Fraser Residence Jakarta and Fraser Residence Menteng, which have been operating since 2011 and 2014, respectively. Frasers Hospitality will further
We have identified a total of six new serviced apartment developments in the next three years that will be located in the CBD area, South Jakarta and Central Jakarta. All of these will be operated by renowned global brands, such as Frasers Hospitality, Ascott Limited and Oakwood. In fact, although the competition among serviced apartments has become tougher over the past two years, Jakarta still presents an opportunity for hospitalityand tourism-related businesses to grow, in particular due to the ASEAN Economic Community (AEC), which may open more opportunities for foreign investment, foreign capital and skilled labour coming to Jakarta.
Serviced Apartment Supply Pipeline in Jakarta Apartment name
location
region
developer
#units
Status
2016 Fraser Suites at Ciputra World Jakarta 2
Jl. Prof. Dr. Satrio
CBD
Ciputra
200 Under Construction
Oakwood at District 8 Senopati
Jl. Senopati
South Jakarta
Agung Sedayu Group
180
Fraser Residence Serenia Hills
Jl. Lebak Bulus
South Jakarta
TBA*
TBA*
In Planning
Capri by Fraser Simatupang
Jl. TB Simatupang
South Jakarta
TBA*
TBA*
In Planning
Fraser Suites Kebon Melati
Jl. Kebon Melati
Central Jakarta
TBA*
TBA*
In Planning
Ascott Menteng Jakarta
Jl. Menteng
Central Jakarta
TBA*
150
In Planning
Under Construction
2018
2019
*TBA: to be announced Source: Colliers International Indonesia - Research
Occupancy Rate In general, activity of apartments for lease in Jakarta remains weak in the first quarter of 2016. Dealing with increased competition from individually-owned apartments and the shrinkage in the number of expatriate arrivals is a double whammy, making it harder for vacant units to be absorbed. The problem is also compounded by a less than optimistic outlook for particular industries, such as electronics, as well as the oil and gas sector, as some of them have announced layoffs or even closed business operations in Indonesia. The average occupancy rate fell from 73.6% in Q4 2015 to around 71.9%. In terms of type, serviced apartments experienced an occupancy decrease of 4% compared to the previous quarter and 6.7% YoY, while non-serviced apartments had a relatively more stable performance of about 77%. The occupancy level in the CBD area experienced a significant drop by 3.7% due to the absence of new tenants together with low occupancy at the newly operating serviced apartments, Fraser Palace Setiabudi.
Occupancy Rates Changes of Apartment for Lease (by Type) Q1 2015
Q4 2015
Q1 2016
QoQ
YoY
Non-serviced
77.6%
77.3%
77.0%
-0.3%
-0.7%
Serviced
69.3%
66.6%
59.6%
-7.0%
-9.7%
Source: Colliers International Indonesia - Research
Occupancy Rates in Different Locations in Jakarta Q1 2015
Q4 2015
Q1 2016
CBD
80.0%
78.2%
71.5%
South Jakarta
76.5%
73.2%
72.0%
-1.2%
-4.5%
Non-prime area
69.8%
69.9%
69.6%
-0.3%
-0.2%
Source: Colliers International Indonesia - Research
19 Research & Forecast Report | Q1 2016 | Apartment | Colliers International
QoQ
YoY
-6.7%
-8.5%
Demand continued to be suppressed due to concerns about the economy, business uncertainties and tightened corporate housing budgets. Upscale serviced apartments, which are typically dominated by larger family type apartments and 3-bedroom units or above, experienced weak demand. On the other hand, shifting demand to more popular smaller apartment units continues to grow. An extended rout in oil prices is likely to force energy companies to minimise their expenditures, particularly for expatriate accommodation in Indonesia. In some cases, at serviced apartments that heavily rely on corporate tenants from oil and gas companies, the occupancy has dropped by 5 - 10% since 2014 when the oil prices started to fall. Some upscale serviced apartments have reported that some tenants with families from oil and gas companies have decided not to extend their stays and have to return their families to their home countries because the company has to limit expatriate remuneration packages, including housing allowances and company-paid school fees. Therefore, the only alternative is moving to a more affordable, smaller apartment located near their workplace.
Rental Rates Almost serviced and non-serviced apartments managed to maintain their rental rates, while only a few serviced apartments operated by international chains were confident enough to increase their rates by between 5 and 15%. In contrast to the occupancy rate, the average rental rate has shown an upward trend with increases of 3.5 and 2.7% QoQ in the CBD and South Jakarta (including Non-prime) areas, respectively. Although most serviced apartments have managed to keep rental rates unchanged, it is still tough to get tenants in the current softening rental market. In the current tenant market situation, landlords and operators are typically open to negotiations and reducing the rental rate. In order to keep the units occupied, landlords are willing to offset a reduction in rental rates with a long-term lease. Based on our findings at several serviced and non-serviced apartments, the real transaction rates could be reduced by between 10 and 20% from the published rental rates.
Concluding Thought The Jakarta apartment market remained subdued in Q1 2016, particularly at the under-construction projects. Rather than aggressively promoting new projects in the market, developers are more focused on selling the unsold units at existing projects. As a result, with many unsold units together with steady sales activity in the market, price increases are hampered. Over the years, we have seen many apartment projects proliferate in Jakarta with relatively good take-up rates from pre-sales activity (at least 80% sold). The main factors stimulating the demand for apartments are a growing middle class who buy apartments as a primary home, occasional living and investment. We are also of the view that the current sluggish performance in apartment sales is likely to be a short-term shock rather than a long-term trend since Jakarta, as Indonesia’s economic centre, has a huge population and expanding middle class, both of which are strong demand drivers. As such, we expect that sentiment in the apartment market, particularly in the pre-sales (under-construction apartment market) will recover meaningfully starting in 2H 2016 as the currency starts to stabilise and economic growth starts to make progress on the back of a lower interest rate environment. Public investment and government spending on infrastructure should be a catalyst for economic growth. The implementation of economic reforms will be crucial in improving apartment market performance. In the leasing market, we have seen that, in some particular cases, compensation packages for expatriates are being reduced, impacting the size of housing allowances, which in some cases are being terminated altogether. With lower budgets for housing, expatriates need to seek cheaper rental alternatives, i.e., moving from international branded serviced apartments to local privately owned strata-title apartments or negotiating for lower monthly rents. In the light of that, we expect the apartment for lease market will not recover in the next couple of quarters.
Rental Rates of Apartment for Lease in Different Locations in Jakarta Q4 2015
Q1 2016
QoQ
CBD
361,290
374,061
3.5%
South Jakarta (including Non-Prime areas)
221,310
227,296
2.7%
Source: Colliers International Indonesia - Research
20 Research & Forecast Report | Q1 2016 | Apartment | Colliers International
RETAIL SECTOR
Jakarta’s Cumulative Supply Based on Marketing Scheme
Supply Jakarta
For Sale
Jakarta’s Cumulative Supply 5,000,000 4,500,000 4,000,000 3,500,000
For Lease
3,000,000 2,500,000
sq m
2,000,000 0
1,500,000 1,000,000
1,000,000
Existing Supply 2016YTD
500,000
2,000,000
3,000,000
4,000,000 sq m
Future Additional Supply 2016F - 2018F
Source: Colliers International Indonesia - Research
Existing Supply
2018F
2017F
2016F
2016YTD
2015
2014
2013
2012
2011
2010
0
Annual Supply
Source: Colliers International Indonesia - Research
Additional supply of retail centres was still very limited in Jakarta. Since One Belpark Mall began operations in mid-2015, the cumulative supply remained at 4.45 million sq m as of Q1 2016. Jakarta is expected to see four shopping centres in 2016. Bassura City Mall and Shopping Mall at Pancoran are expected to begin operation in Q2 2016. The other shopping centres, Pantai Indah Kapuk Mall and Neo Soho Mall at Podomoro City, are expected to begin operation in the second half of 2016. These upcoming shopping centres will bring the cumulative supply to grow by 2.2% YoY in Jakarta.
By 2018, Jakarta is anticipating another 390,000 sq m of additional supply. This is translated into 2.9% of the average annual growth of the cumulative supply during 2016 - 2018. Based on current construction progress, most future shopping centres will be completed in 2018. However, total future supply during 2018 is changeable. This is largely due to future shopping centres that are currently in the planning stage. Apart from future supply in 2016, the rescheduled start of construction works for other future shopping centres will have a large impact on the projected additional supply in 2017 - 2018.
Annual Retail Supply in Jakarta Based on Marketing Scheme 250,000 225,000
West Jakarta East Jakarta
200,000
North Jakarta
175,000 150,000
South Jakarta
125,000
sq m
Retail Supply in Jakarta Based on Area
100,000
Central Jakarta
75,000 50,000
CBD
25,000 0
2018F
2017F
2016F
2015
For Sale
2016YTD
For Lease
2014
2013
2012
2011
2010
0
200,000
400,000
600,000
800,000
1,000,000 sq m
Future Supply in 2016F - 2018F
Existing Supply in 2016YTD
Source: Colliers International Indonesia - Research
Source: Colliers International Indonesia - Research
3,000,000 2,500,000 2,000,000 1,500,000 1,000,000 500,000
2018F
2017F
2016F
2015
Annual Supply
Source: Colliers International Indonesia - Research
22 Research & Forecast Report | Q1 2016 | Retail | Colliers International
2016YTD
Existing Supply
2014
2013
2012
0
2011
Apart from the future supply in 2016 - 2018, at least four future shopping centres have been announced as of Q1 2016, including Fatmawati City (in South Jakarta), Menara Jakarta (in Central Jakarta), Mall at Pantai Indah Kapuk 2 (in North Jakarta) and Kota Wisata (in East Jakarta). Most of these future shopping centres will be developed by big developers and located within huge mixed-use developments.
BoDeTaBek Cumulative Supply
2010
While the mall moratorium still applies in the CBD, retail space is expected to increase in other areas, albeit only slightly. The distribution of these future shopping centres demonstrates that all areas in Jakarta can still be considered for shopping centre development. The distribution of mall development is expected to attract more people to shop at neighbourhood malls instead of heading downtown.
Greater Jakarta Area (BoDeTaBek Bogor, Depok, Tangerang, Bekasi)
sq m
A new shopping centre is not always in the form of newly built premises but could be an old shopping centre with a new look and a new concept. For example, Cilandak Mall in South Jakarta was taken over by Transmart Carrefour and was transformed into Transmart Carrefour Cilandak, which changed the shopping concept into integrated electronics, bread shop, mom & baby, food and fashion beauty stores. This new-concept shopping centres are expected to attract more visitors to the mall. The positive aspect of retail moratorium in DKI Jakarta for developers is that it provides more opportunities for old malls to be upgraded into more enticing shopping centres.
Retail Supply in BoDeTaBek Based on Marketing Scheme
BoDeTaBek’s Annual Supply Based on Marketing Scheme 450,000 400,000 350,000
For Sale
300,000 250,000
sq m
200,000 150,000 100,000
For Lease
50,000
Existing Supply 2016YTD
For Lease
Future Additional Supply 2016F - 2018F
2018F
2017F
2016F
2016YTD
2015
2014
2011
2013
500,000 1,000,000 1,500,000 2,000,000 2,500,000 sq m
2012
0
2010
0
For Sale
Source: Colliers International Indonesia - Research
Source: Colliers International Indonesia - Research
Four shopping centres are expected to begin operations in 2016 and 2017. Similar to Jakarta, BoDeTaBek will start having additional retail supply in H2 2016. The cumulative supply in BoDeTaBek was 2.37 million sq m as of Q1 2016. It is projected that two shopping centres will provide 125,000 sq m of retail space by end of 2016, which means a growth in supply by 5.3% YoY.
BoDeTaBek’s Cumulative Supply Based on Area
The current cumulative supply in BoDeTaBek was 53.2% of the total supply in Jakarta. However, the projected additional space in BoDeTaBek in 2016 - 2018 is expected to be higher than in Jakarta. All of these shopping centres that are scheduled to start operations in 2018 are still in the planning stage. It is likely that the forecasted additional supply in BoDeTaBek will decrease, particularly in 2018. Based on area, Bekasi is expected to become a major contributor of future shopping centres. Most shopping centres will be located in or near industrial estates. Growing infrastructure, such as toll roads and Light Rapid Transit (LRT), is also expected to have an impact on shopping centre development in southern Jakarta, especially in Depok and Bogor. It has been announced that shopping centres will be built within two massive residential developments in Depok. These future shopping centres will capitalise on the toll road development that connects southern to western Jakarta and downtown.
Bekasi
Tangerang
Depok
Bogor
0
300,000
600,000
900,000
1,200,000 sq m
Existing Supply in 2016YTD
Future Supply in 2016F - 2018F
Source: Colliers International Indonesia - Research
23 Research & Forecast Report | Q1 2016 | Retail | Colliers International
New Supply Pipeline shopping centre
location
region
developer
NLA (sq m)
development Status
Jakarta 2016 Pantai Indah Kapuk Mall
Pantai Indah Kapuk
North Jakarta
Agung Sedayu
Shopping Mall @ Pancoran
Pancoran
South Jakarta
Agung Podomoro
30,000 Under Construction
Neo SOHO Mall (Podomoro City)
Slipi
West Jakarta
Agung Podomoro
40,000 Under Construction
Mall at Bassura City
Basuki Rahmat
East Jakarta
Synthesis Karya Pratama
15,000
Glodok
West Jakarta
Agung Podomoro
60,000 Under Construction
Cakung
East Jakarta
Aeon
71,000 Under Construction
8,000
Under Construction Under Construction
2017 New Harco Plaza 2018 Aeon Mall Garden City Mall @ Green Pramuka City
Pramuka
North Jakarta
Duta Paramindo Sejahtera
30,000 In Planning
Mal Puri Indah 2
Puri Indah
West Jakarta
Antilope Madju Puri Indah
50,000 In Planning
Holland Vilage Mall
Cempaka Putih
Central Jakarta
Lippo Karawaci
40,000
Shopping Mall at Podomoro Park
Buaran
East Jakarta
Agung Podomoro
40,000 In Planning
In Planning
BoDeTaBek 2016 Bekasi Trade Center 2
Bulak Kapal
Bekasi
Gapura Prima
56,000
Under Construction
Q Big
BSD City
Tangerang
Sinarmas Land
69,000
Under Construction
2017 Grand Dhika City Mall
Bekasi
Bekasi
Adhi Persada Realty
24,000 Under Construction
Metropolitan Mall Cileungsi
Cileungsi
Bogor
Metropolitan Land
25,000
Under Construction
Jababeka
Bekasi
Plaza Indonesia & Graha Buana Cikarang
55,685
Under Construction
90,000 In Planning
2018 Plaza Indonesia Jababeka Aeon Mall Deltamas
Deltamas
Bekasi
Aeon
Aeon Mall Sentul
Sentul
Bogor
Aeon
15,000 In Planning
Embarcadero
Bintaro
Tangerang
Lippo Karawaci
30,000 In Planning
Hollywood Central
Cikarang
Bekasi
Graha Buana Cikarang
25,000 In Planning
Kota Harapan Indah
Bekasi
Bekasi
Hasana Damai Putera
51,000 In planning
Living World Jababeka
Jababeka
Bekasi
Kawan Lama
18,000
Vivo Sentul Lifestyle
Cibinong
Bogor
Megapolitan
30,000 In Planning
Vivo Sentul Trademall
Cibinong
Bogor
Megapolitan
13,000
Source: Colliers International Indonesia - Research
24 Research & Forecast Report | Q1 2016 | Retail | Colliers International
In Planning In Planning
YoY Comparison: Number of Vacant Space Based on Area
Occupancy Jakarta
120,000
The Occupancy Rates in The CBD and Outside The CBD
100,000
100%
80,000
90% 60,000
80%
sq m
70% 60% 50%
40,000 20,000
40% 0
30%
CBD
20% 10%
Central South Jakarta* Jakarta* Q1 2015
0% 2010
2011
2012 CBD
2013
2014
2015
2016YTD
North Jakarta
East Jakarta
West Jakarta
Q1 2016
*excluding CBD Source: Colliers International Indonesia - Research
Outside CBD
Source: Colliers International Indonesia - Research
Occupancy was relatively flat QoQ in Jakarta. Slowing purchasing due to economic growth since 2015 still has quite a large impact on shopping centre performance. As of Q1 2016, occupancy only recorded a slight increase to 86.3%. Some branded retailers at a shopping centre in Jalan Satrio closed. Fortunately, the other three shopping centres helped maintain the occupancy at 92.4% currently in the CBD despite dropping moderately YoY. H&M remains an active retailer and will continue to open new stores in the CBD area. In the meantime, F&B retailers are still actively expanding in the CBD, and this has helped the average occupancy to stabilise above 90%, at least since 2006. Occupancy was fluctuating mildly YoY outside the CBD. A newly opened shopping centre caused the occupancy to drop despite rebounding gradually to 84.3% as of Q1 2016. The average occupancy has been recorded below 90% since 2010 outside the CBD.
Occupancy Performance Based on Grade of Shopping Centres Q1 2015
Q1 2016
CBD
92.90%
Central Jakarta*
73.10%
72.60%
South Jakarta*
90.70%
88.50%
91.2%
Middle Class
85.8%
88.1%
Middle Low Class
80.3%
79.4%
YoY
92.40%
North Jakarta
83.70%
83.90%
East Jakarta
87.40%
88.10%
West Jakarta
80.90%
81.10%
Q1 2016
Upper Class
Source: Colliers International Indonesia - Research
QoQ Occupancy Based on Area Q1 2015
While the other grades of mall reporting a declining occupancy rates, middle-class shopping centres showed an increase of 2.3% YoY that brought the overall occupancy to 88.1% as of Q1 2016. Middle- to lower-class shopping centres experienced the greatest decline than other grades, although moderate YoY. Performance of some trade malls (mixed concept of leased and trade centre) caused the average occupancy at the middle- to lower- class shopping centres achieving as the lowest. Several shopping centres located in the West and Central Jakarta had made the largest contribution of vacant space at middle- to lower-class shopping centres. Two trade malls in those areas still have more than 20,000 sq m of vacant space as of Q1 2016.
*excluding CBD Source: Colliers International Indonesia - Research
25 Research & Forecast Report | Q1 2016 | Retail | Colliers International
90.8%
Number of Vacant Space Based on Grade of Shopping Centres 350,000 300,000 250,000
sq m
200,000
Leasing activities at existing shopping centres were relatively flat YoY. However, most future shopping centres have secured some committed tenants. H&M, Uniqlo and The Food Hall have confirmed that they will occupy space at Pantai Indah Kapuk Mall. H&M and Uniqlo are set to support the landlord’s concept, which will adopt Japanese style and culture, particularly for food and beverage tenants. Bassura City Mall will also provide more food and beverage concepts. Located within a massive residential development, this mall is expected to provide basic needs, particularly food and beverage, for people who live in the residences nearby.
150,000 100,000 50,000 0 2014
2015
Upper Classes
2016YTD
Middle Lower Classes
Source: Colliers International Indonesia - Research
Committed Tenants at Future Shopping Centres in Jakarta Shopping Centre Name
Major / Mini Anchor
Fashion and Accessories
Food and Beverage
Pantai Indah Kapuk
The Food Hall, XXI, Ace Hardware, Gold’s Gym, Informa
H&M, Uniqlo, Optik Melawai, Sports Station, Giordano, Levi’s Store, Timberland
Pizza Hut, Starbucks, Excelso
Bassura City Mall
Cinema XXI, Lion Superindo
Optik Melawai, Sports Station, The Body Shop
Starbucks, Imperial Kitchen
Neo SOHO
Central Department Store, Kid Station, Electronic Solution
Pedro, The Body Shop, Clarks, Staccato, Polo Ralph Lauren, Samsonite, Wrangler, Wood, Cotton On, Mango, Nine West, Charles & Keith, Armani Jeans, Furla
Ta Wan, Pizza Hut, Pepper Lunch
Source: Colliers International Indonesia - Research
BoDeTaBek Occupancy Rates Based on Area Q1 2015
Q1 2016
Bogor
86.10%
82.90%
Depok
85.10%
86.90%
Tangerang
81.70%
82.00%
Bekasi
83.20%
85.80%
Source: Colliers International Indonesia - Research
Since declining due to a newly opened shopping centre last year, occupancy continued to increase in BoDeTaBek. However, occupancy only showed a slight increase to 84.1% as of Q1 2016. Based on area, Tangerang, Depok and Bekasi showed increasing occupancy rates YoY.
Shopping centres that began operations in 2013 have kept the average occupancy rates in Bekasi and Depok increasing. Tangerang experienced a decreasing occupancy rate in mid2015. Occupancy climbed significantly in the following quarter in line with good absorption in that new shopping centre. However, Tangerang only recorded a slightly increasing occupancy rate in the last two quarters. Meanwhile, vacant space has increased at some shopping centres in Bogor, particularly since mid-2015. Foreign retailers are also eyeing some potential areas in BoDeTaBek at both existing and future shopping centres. H&M will open at a shopping centre in Karawaci (Tangerang). Lulu Supermarket will take a large space at a future shopping centre in BSD (Tangerang).
26 Research & Forecast Report | Q1 2016 | Retail | Colliers International
Jakarta Average Rental Rates
Vacant Space Based on Area, YoY 120,000
IDR900,000
100,000
IDR750,000 IDR600,000
80,000
IDR450,000
sq m
60,000
IDR300,000
40,000
IDR150,000
20,000
IDR0
0 Bogor
Depok Q1 2015
Tangerang
Committed Tenants at Future Shopping Centres in BoDeTaBek
Q Big City
CBD
Q1 2016
Source: Colliers International Indonesia - Research
Shopping Centre Name
2010
Bekasi
Major/Mini Anchor Mitra 10, Lulu Hypermarket, Informa, Ace Hardware, Toys Kingdom
Source: Colliers International Indonesia - Research
Asking Rental Rates Jakarta Average asking rents in Jakarta increased by 4.7% YoY to IDR545,968 / sq m / month as of Q1 2016. Asking rents at shopping centres are recorded dynamically depending on available space and lease term. Particularly based on vacant space, we noted that some shopping centres are posting different rates this quarter. A shopping centre located in the CBD area lowered its asking rents for some vacant space on the upper floors. We also found a different asking rent compared with last year at another shopping centre in South Jakarta. Based on availability, the asking rent for space offered on the ground floor was lower QoQ. It is likely that those vacant spaces are located in a non-prime area. Conversely, asking rents on the upper floors are higher QoQ based on space offered.
2012 Outside CBD
2014
2016YTD Jakarta
Source: Colliers International Indonesia - Research
Based on mall grade, there was a large gap between premium shopping centres and other classes. Currently, asking rents at some spaces offered at premium shopping centres are above IDR2 million / sq m / month. This is double the asking rent in the main areas of middle- to upper-class shopping centres in Jakarta. All of those premium shopping centres are located in the CBD. However, some shopping centres in the CBD area are categorised as middle to lower class, and caused a wide range of asking rents with premium class. Vacant space at middle- to lower-class shopping centres in the CBD are currently charging between IDR300,000 and 500,000 / sq m / month. In addition to the CBD, shopping centres in West and South Jakarta also showed a big gap in asking rents. Shopping centres located in the western part of South Jakarta, including Pondok Indah, Kebayoran and Kemang, have higher asking rents than some parts in South Jakarta. There was also a similar trend in West Jakarta. The growing number of middle- to upper-class residences and infrastructure will give shopping centres a big advantage. Established shopping centres, such as Puri Indah Mall, Mall Taman Anggrek, Central Park Mall and Citraland, feel confident in increasing their asking rents.
27 Research & Forecast Report | Q1 2016 | Retail | Colliers International
Range of Rental Rates Based on Mall Grade
BoDeTaBek The average asking rent in BoDeTaBek was IDR344,353 / sq m / month as of Q1 2016, climbing 9% YoY. This growth was higher than that of the previous year, which means that landlords and developers feel more confident in raising the rent for space, particularly those located in premium areas.
IDR2,500,000
IDR2,000,000
Asking rents for premium vacant space at some shopping centres in Tangerang and Bekasi are between IDR700,000 and 800,000 / sq m / month as of Q1 2016. This is equal to the asking rents at some well-known shopping centres in West and South Jakarta.
IDR1,500,000
IDR1,000,000
Range of Rental Rates IDR500,000
IDR1,000,000 IDR900,000
IDR0 Premium
Middle Upper
Middle
Middle Lower
IDR800,000 IDR700,000
Source: Colliers International Indonesia - Research
IDR600,000
Range of Rents Based on Area
IDR500,000 IDR400,000
IDR2,500,000
IDR300,000 IDR200,000
IDR2,000,000
IDR100,000 IDR1,500,000
IDR0 Bogor
IDR1,000,000
Depok
Tangerang
Bekasi
Source: Colliers International Indonesia - Research
Average Asking Rents Based on Area, YoY
IDR500,000
IDR400,000 IDR0
IDR350,000 CBD
Central South North East West Jakarta* Jakarta* Jakarta Jakarta Jakarta
*excluding CBD Source: Colliers International Indonesia - Research
IDR300,000 IDR250,000 IDR200,000 IDR150,000 IDR100,000 IDR50,000 IDR0 Bogor
Depok Q1 2015
Tangerang Q1 2016
Source: Colliers International Indonesia - Research
28 Research & Forecast Report | Q1 2016 | Retail | Colliers International
Bekasi
The fact that retail spaces were absorbed quite well caused landlords to be confident in adjusting their current asking rents. A shopping centre in Bekasi has doubled its asking rent for vacant space in premium zones since the mall was launched. In addition to the limited vacant space, changing and improving mall concepts are factors that lift the rental tariff.
The average service charge at middle- to lower-class shopping centres was IDR94,411 / sq m / month. However, as of Q1 2016, 40 shopping centres still had service charges below those of average middle- to lower-class shopping centres, as mentioned above. Around 10% of those shopping centres are located in the CBD.
Range of Service Charges Based on Mall Grade
Service Charge
IDR300,000
Jakarta IDR250,000
Jakarta Average Service Charges IDR160,000
IDR200,000
IDR140,000 IDR150,000
IDR120,000 IDR100,000
IDR100,000
IDR80,000 IDR50,000 IDR60,000 IDR40,000
IDR0 Premium
IDR20,000
Middle Upper
Middle
Middle Lower
Source: Colliers International Indonesia - Research
IDR0 2010 CBD
2012 Outside CBD
2014
2016YTD Jakarta
Range of Service Charges Based on Area IDR300,000
Source: Colliers International Indonesia - Research
Service charges were recorded at IDR118,473 / sq m / month as of Q1 2016, showing an increase of 11.6% YoY. Based on mall grade, the average service charge at upper class shopping centres (premium and middle to upper class) reached IDR148,706 / sq m / month as of Q1 2016, an increase of 9.2% YoY. Some shopping centres in this grade increased their service charges to as much as 30% YoY. Currently, the range of service charges at upper-class shopping centres is IDR100,000 to 270,000 per sq m per month. However, at least 16 middle-class shopping centres recorded service charges above those of the upper-class malls. Most of those middle-class shopping centres are located in South and North Jakarta. Based on area, in addition to the CBD, South Jakarta showed a wider range of service charges. Most were between IDR50,000 and 100,000 / sq m / month. Only a few shopping centres reported service charges above IDR100,000 / sq m / month as of Q1 2016. West Jakarta had the second highest service charges. Service charges at some major shopping centres in West Jakarta are currently above IDR100,000 / sq m / month.
IDR250,000 IDR200,000 IDR150,000 IDR100,000 IDR50,000 IDR0 CBD
Central South North Jakarta* Jakarta* Jakarta
*excluding CBD Source: Colliers International Indonesia - Research
29 Research & Forecast Report | Q1 2016 | Retail | Colliers International
East Jakarta
West Jakarta
BoDeTaBek Range of Service Charges IDR160,000 IDR140,000 IDR120,000 IDR100,000 IDR80,000 IDR60,000 IDR40,000 IDR20,000 IDR0 Bogor
Depok
Tangerang
Bekasi
Source: Colliers International Indonesia - Research
Service charges remained between IDR40,000 and 120,000 / sq m / month in BoDeTaBek. Only less than 5% of all shopping centres in BoDeTaBek had service charges above IDR120,000 / sq m / month. As of Q1 2016, the average service charge grew 6.3% YoY to IDR85,347 / sq m / month. This growth was double that of last year. Landlords and developers have become more aware that providing and upgrading facilities will attract more potential tenants, particularly branded and / or foreign retailers. As of Q1 2016, service charges at almost 50% of all shopping centres in BoDeTaBek still had below-average service charges. Most of those shopping centres are located in Bekasi and Tangerang.
Service Charges Based on Area, YoY IDR100,000
IDR80,000
IDR60,000
IDR40,000
IDR20,000
IDR0 Bogor
Depok Q1 2015
Tangerang
Bekasi
Q1 2016
Source: Colliers International Indonesia - Research
30 Research & Forecast Report | Q1 2016 | Retail | Colliers International
Industrial Land Supply The industrial land transaction activity appears to be languishing simply because most industrial clients have yet to see the good timing to buy. This has also underlined supply situation for the quarter with less construction activities. Most of our industrial colleagues confirmed this and thus, such situation has characterized the general sales condition during the reviewed quarter. Bekasi may see less industrial land expansion in the future given the increasingly-limited land bank in this region. One industrial land with the biggest vacant land among others may be the only option for industrial clients looking for sizeable land. As land became scarce in Bekasi area, prices are the highest compared to other regions. In Bekasi there is only a few industrial estates with expansion plan and therefore potential land to be developed in this region is limited. Some industrial estates are now focusing more on developing commercial area particularly those holding prime land lots within the estates. Mature industrial estates with established tenants generally benefit from the population of multinational companies as well as local and expatriate workers. There are several industrial estates that emphasise more on commercial and residential developments to maximise the use and the profit of the remaining land. Furthermore, Bekasi region will take benefit from the major undergoing infrastructure project i.e. the LRT (Light Rail Transit) to serve the city to and from Jakarta. The constructions of massive apartment projects are becoming very common nowadays in Bekasi, as well as other commercial functions like hotel, shopping centre or even office building. Karawang holds the largest industrial land bank to be developed, particularly from the construction of Trans Hexa Karawang (THK) consortium project. The general infrastructure of this mega project is ready to serve the whole estate. GT Techpark @ Karawang seemed to be the most progressive under-construction
Another potential expansion in Karawang region will come from KIIC with circa 160 hectare of gross area. Currently the estate only holds limited land for sale and need to expand in anticipation of transactions in the future. Other than the two active regions is Serang where two prominent industrial estates hold potential land to be developed. In the future, Serang anticipates more than 2,000 hectare only from the expansion of the two industrial estates. Further south of Jakarta, Bogor region is the only region with smaller potential land to be developed from main operating industrial estates.
Industrial Land Stock Status in Some Active and Future Industrial Estates 4,000 3,500 3,000 2,500
Hectares
Industrial Estate Sector
industrial estate of the consortium so far. Meanwhile, Karawang Jabar Industrial Estate (part of Lippo Group) that is located at the main entrance of THK has Toyota Motor Manufacturing Indonesia that built the second engine plant to boost the production capacity. Still in the THK, Podomoro Industrial Park (Agung Podomoro Group) holds more than 500 hectares of land and thus far has developed around 28 hectares.
2,000 1,500 1,000 500 0 Bogor
Existing Stock
Tangerang
Karawang
Remaining Unsold Land
Bekasi
Serang
Potential Land To Be Developed
Land Sales Activities In general, sales activity tapered off. The majority of high performing industrial estates reported that sales volume began to ebb compared to the previous period. Quite a few of them said that even the number of inquiries lessened with only a few concluded deals. Total industrial land sales this quarter only achieved 19.39 hectares, slightly higher than in the previous quarter of 17.35 hectares. For the last two consecutive quarters sales has been quite slow. The total volume of transaction this quarter was way lower than that was achieved in the same period last year. The lackadaisical sales performance since the second semester last year continued during the first period of 2016.
Land Absorption in Q1 2016 Modern Cikande Bekasi Fajar Greenland International Industrial Centre Millennium KIIC Podomoro Industrial Park Delta Silicon
KIIC is the only estate reporting sales during Q1 2016 albeit in moderate number of 2 hectares composed from two deals. Both transactions came from two new plastic molding industries from Taiwan and Japan. The under construction industrial estate, Podomoro Industrial Park also reported pre-sales of 1.5 hectares land. Total 3.5 hectares being transacted in Karawang was basically better than sales last quarter that was only recorded of less than one hectare. On contrary, total sales in Bekasi reduced by around 30% over the previous quarter to 8.3 hectares. The overall performance in Bekasi was mainly fueled by 5.2 hectares transaction concluded in Bekasi Fajar Industrial Estate (BFIE) from a local company in the warehouse line of business. Meanwhile the transaction volume in Greenland moved forward after registering zero sales last quarter. A total of 2.3 hectares of land sales in Greenland were composed from three different industries including can packaging, logistics and construction. Another small transaction in Bekasi was reported in Delta Silicon that sold 0.8 hectare land comprising of two transactions from plastic company out of Korea and auto-part industry from Taiwan. Albeit small, Millennium continued to record transactions from the sales of three land parcels with a total amount of 2.09 hectares. The record breaker industrial estate for several periods, Modern Cikande only sold 5.5 hectares this period to a new auto-part industry from Malaysia. Despite small, this is so far the largest single transaction during Q1 2016.
0
1
2
3
4
5 hectares
Source: Colliers International Indonesia - Research
Types of Activities Industries During Q1 2016 Molding 10.31%
Developer 4.13%
Others 18.51%
Logistics/ Warehousing 30.94%
Manufacturing 3.61% Plastics 1.55% Source: Colliers International Indonesia - Research
32 Research & Forecast Report | Q1 2016 | Industrial Estate | Colliers International
Automotive 30.94%
6
Annual Industrial Land Absorption
Greater Jakarta Industrial Land Prices
1,400
USD240.00 USD210.00
1,000
USD180.00 USD/sq m
1,200
600
USD150.00 USD120.00 USD90.00
400
USD60.00 USD30.00
200
Bogor
Bekasi
Tangerang
Karawang
Serang
Source: Colliers International Indonesia - Research
Land Price Despite the low performance, two industrial estates in Serang pushed the asking land price further up in Q1 2016 at an average of 17%. Overall, the average land price in Serang is one the lowest among other region, nevertheless, the quality of the estate justifies the price as well as the continued absorption that has been the main reason to adjust prices. Industrial estates in other regions tend to maintain the current prices quotation particularly during the tough time. There are still some industrial estates that quote price using US dollar benchmark which is not in compliance with Bank Indonesia (The Central Bank) regulation. The reasons to maintain “informal” quotation in US dollar denomination are because it is simpler for the potential overseas clients and also in order to protect them from the currency risk particularly in anticipation of volatile exchange rate. Prices will then be charged in rupiah value using the current Central Bank middle rate value. To date, as the exchange range value has been stabilising for several months and in order to comply with the regulation, several prominent industrial estates have migrated to use rupiah as the price tag. Two industrial estates affiliated with big international group have decided to quote prices in rupiah with equivalent value to their prior price in US dollar.
Bogor
Bekasi
Tangerang
Karawang
2016YTD
2015
2014
2013
2012
2011
2010
2009
2006
2015
2014
2013
2012
2011
2010
2009
2008
2007
2006 Jakarta
2008
USD0.00
0
2007
Hectares
800
Serang
Source: Colliers International Indonesia - Research
Industrial land quoted in US dollars will be converted to Indonesian rupiah when a transaction occurs. This has been implemented by most industrial estates with pricing in US dollars in complying with the Central Bank regulation to use rupiah in any transaction in Indonesia.
Industrial Land Prices and Maintenance Costs (in USD equivalent) region
Land price (in USD/sq m) average
maintenance costs (in usd/sq m/month)
lowest
highest
Bogor
120.00
206.99
163.50
0.06
0.06
0.06
Bekasi
192.21
236.56
221.51
0.06
0.08
0.07
Tangerang
140.46
147.85
144.16
0.03
0.08
0.06
Karawang
170.00
200.00
185.00
0.05
0.10
0.06
Serang
147.85
162.64
155.25
0.03
0.05
0.04
*1USD = Rp 13,527 Source: Colliers International Indonesia - Research
Amidst the sluggish sales performance, the asking price was maintained at a current level, nevertheless, it is indicated that landlords are more accommodating on any offer coming to them which implies that in general industrial market like other property sectors are in the tenant market condition.
33 Research & Forecast Report | Q1 2016 | Industrial Estate | Colliers International
lowest
highest average
Rental Market
Concluding Thought
Apart from the traditional industrial estates that focus on leasing market, a few industrial estates have started to introduce building or land for lease. An industrial estate for lease in Karawang asks for industrial building rental tariff at IDR50,000 to 60,000 / sq m / month. Meanwhile one industrial estate in the same region that primarily sells land introduce tariff for leasing industrial building at USD7.25 / sq m / month. Interestingly this industrial estate also started to introduce industrial land plot for lease at IDR1.00 / sq m / month. Other under construction industrial estate in Karawang has also indicated the rental tariff for industrial building at IDR40,000 / sq m / month.
Due to the adverse economic climate and the competitive sales environment, the industrial market continued to experience further downward pressure as reflected in low sales performance. Large of industrial landlords reported a lethargic market condition highlighted by lessening amount of sales volume or even zero sales during the quarter. Nevertheless, such condition has been anticipated since last year given that Indonesia economy is in the preparation period to rebound. In general, most industrialists have yet to make a strategic decision in investing, however, the outlook should be positive given that they are still monitoring the right momentum to accelerate.
In Bekasi, one strategically located industrial estate that only focus on selling industrial land indicated that the secondary rental market for industrial building are generally quoted between IDR40,000 and IDR100,000 / sq m / month.
In more realistic way, given that selling sizeable land are becoming more challenging, one under construction industrial estate in Karawang are now focusing on selling a more massive products. A warehouse cluster with the size of between 500 and 1,000 sq m are becoming a more feasible product to sell during the current time. One good example is one industrial park in Tangerang that concentrate on selling smaller warehouse within a nicely designed estate that recorded good sales thus far.
Still within the range, standard industrial building within one industrial estate in Serang is offered at IDR45,000 / sq m / month.
Maintenance Costs This quarter saw no reason to adjust maintenance tariff. The majority of industrial estates located in the eastern part of greater Jakarta area maintains the quotation in US dollar as the reference but will convert to the prevailing exchange rate when transaction occurs. Thus far two active industrial estates in Serang have officially applied the new maintenance tariff which they have been announced in the previous quarter.
Greater Jakarta Industrial Maintenance Costs USD0.10
USD0.08
USD/sq m/month
USD0.06
USD0.04
USD0.02
Bogor
Bekasi
Tangerang
Karawang
2016YTD
2015
2014
2013
2012
2011
2010
2009
2008
2007
2006
USD0.00
Serang
Source: Colliers International Indonesia - Research
34 Research & Forecast Report | Q1 2016 | Industrial Estate | Colliers International
Research & Forecast Report Jakarta | Hotel 2Q 2015
Hotel Sector Tourism Highlights For the last years, the Indonesian government has put great effort into accelerating the growth of the tourism industry. The Ministry of Tourism has secured the highest budget for this sector in 2016, particularly through the tagline “Wonderful Indonesia” that has gained world recognition by winning three out of six categories from the United Nations World Tourism Organization (UNWTO). Thus far, the government has been on the right track by also achieving the World Halal Tourism Award, i.e. the award for the Best Halal Tourist Destination and the Best Halal Honeymoon Destination for Lombok, West Nusa Tenggara Province. At the hoteliers’ level, Best Family-Friendly Hotel went to Sofyan Hotel. We also noted that Indonesia is one of the chosen destinations for Middle East tourists and is expecting 12 million visits.
Accelerating success.
In the 4-star hotel category, Swiss-Belhotel Group expanded and opened one hotel in the Pondok Indah area. Swiss-Belhotel Pondok Indah provides 159 rooms. This hotel became the third in the Pondok Indah area after Hotel Kristal and Best Western The Bellevue Hotel. This brings the total of rooms at 4-star hotels in Jakarta to 15,355 rooms at 68 hotels. During the Q1 2016, there were no new 5-star hotels in Jakarta, but the supply of new 5-star hotels may increase in mid-year 2016. Among the big hotel chain operators in Indonesia, Accor is dominating the market in Indonesia followed by Santika Hotel & Resorts and Archipelago International, as depicted in the graph below.
Most Active Hotel Chain Operators in Jakarta (including Budget Hotel) - Based on Number of Project Swiss-Belhotel International 9%
InterContinental Hotel Group 8%
Santika Hotel & Resorts 24%
Supply At the end of 2014, the owner of the Four Seasons hotel announced its closure due to demolition of the hotel. The owner will rebuild new hotel which will be in operation in 2019. The new project is now under construction and when it is completed, St. Regis will manage the hotel. St. Regis was supposed to manage the new hotel in Jalan Jenderal Gatot Subroto but it has now been confirmed that it will be managed by Four Seasons. The year 2015 marked a downturn in the hotel sector. Since Q1 2015, the hotel sector has faced unfavourable conditions. Although hotel performance slightly improved during the last quarter of 2015, the overall performance was still below that in 2014. During Q1 2016, there was only one new 3-star hotel in Jakarta, i.e. Cemara Hotel which added 150 rooms to the market. In Q1 2016, all 87 of the 3-star hotels had a total of 10,363 rooms.
Tauzia Management 7%
Archipelago International 24%
Accor 28% Source: Colliers International Indonesia - Research
Cumulative Supply of Star-Rated Hotel Projects in Jakarta
Cumulative Supply of Star-Rated Hotel Rooms in Jakarta
100
21,000
90
18,000
80 15,000
70 60
12,000
50
9,000
40 30
6,000
20
3,000
10
4-star
3-star
5-star
Source: Colliers International Indonesia - Research
4-star
2019F
2018F
2017F
2016F
2016YTD
2015
2014
2013
2012
2010
2019F
2018F
2017F
2016F
2016YTD
2015
2014
2013
2012
2011
2010
3-star
2011
0
0
5-star
Source: Colliers International Indonesia - Research
Hotel Developments in Pipeline hotel
star rating
str global equivalent rate
location
region
rooms
projected completion time
Harper Cawang Hotel & Conference Center
3-star
N/A
Cawang
East Jakarta
108
Q2 2016
Yello Hotel Hayam Wuruk
3-star
N/A
Hayam Wuruk
Central Jakarta
372
Q3 2016
Harper TB Simatupang
3-star
N/A
TB Simatupang
South Jakarta
180
Q3 2016
Holiday Inn Express Cikini
3-star
Upper Midscale Class
Cikini
Central Jakarta
212
2016
Whiz Prime Hayam Wuruk
3-star
N/A
Hayam Wuruk
Central Jakarta
100
2016
Big Hotel (Extention)
3-star
N/A
Sawah Besar
North Jakarta
75
2016
Holiday Inn Express Simatupang
3-star
Upper Midscale Class
TB Simatupang
South Jakarta
200
2016
Ibis Styles Jakarta PIK
3-star
Midscale Class
Pantai Indah Kapuk
North Jakarta
200
2016
Ibis Styles Tanah Abang
3-star
Midscale Class
Tanah Abang
Central Jakarta
225
2017
Grand Zuri Mangga Dua
3-star
N/A
Mangga Dua
Central Jakarta
130
2017
Hotel Pasar Senen
3-star
N/A
Senen
Central Jakarta
200
2017
Santika TB Simatupang
3-star
Upper Upscale Class
TB Simatupang
South Jakarta
160
Q1 2018
Total 3-star hotel rooms
2,162
Swiss-Belhotel - Kelapa Gading
4-star
Upper Midscale Class
Kelapa Gading
North Jakarta
316
Q2 2016
Mercure Cikini
4-star
Upper Midscale Class
Cikini
Central Jakarta
207
Q2 2016
Swiss-Belhotel Rasuna Epicentrum
4-star
Upper Midscale Class
Rasuna Epicentrum
South Jakarta
323
Q3 2016
Harris Hayam Wuruk
4-star
Upscale Class
Hayam Wuruk
Central Jakarta
238
Q3 2016
Holiday Inn Hotel & Resorts Jakarta Gajah Mada
4-star
Upper Midscale Class
Gajah Mada
Central Jakarta
420
Q4 2016
Prima Hotel
4-star
N/A
KH Wahid Hasyim
Central Jakarta
150
2016
Aston Titanium Cijantung
4-star
Upscale Class
Cijantung
East Jakarta
225
2016 Continued
36 Research & Forecast Report | Q1 2016 | Hotel | Colliers International
Name of development
star rated
str global equivalent rate
location
region
No. of rooms
projected completion time continuation
Grand Orange Pasar Baru Mansion
4-star
N/A
Pasar Baru
Central Jakarta
222
2016
Suite Novotel Jakarta PIK
4-star
Upscale Class
Pantai Indah Kapuk
North Jakarta
220
2016
Grand Whiz Poin Square
4-star
N/A
Lebak Bulus
South Jakarta
132
2016
Indigo Kemang
4-star
Upscale Class
Kemang
South Jakarta
150
2016
Aston Sunter Hotel
4-star
Upscale Class
Sunter
North Jakarta
150
2016
Ancol Courtyard Marriott Hotel
4-star
Upper Upscale Class
Ancol
North Jakarta
310
2016
Holiday Inn & Suites Simatupang
4-star
Upper Midscale Class
TB Simatupang
South Jakarta
300
2016
aloft Kebon Jeruk
4-star
Upscale Class
Kebon Jeruk
West Jakarta
140
Q1 2017
Batiqa Cassablanca
4-star
N/A
Kasablanka
South Jakarta
156
Q1 2017
Novotel Cikini
4-star
Upscale Class
Cikini
Central Jakarta
286
Q2 2017
Oyama Centre
4-star
N/A
Yos Sudarso
North Jakarta
160
Q3 2017
Mercure Matraman
4-star
Upper Midscale Class
Matraman
South Jakarta
150
Q3 2017
Horison Ultima Jakarta
4-star
N/A
Cawang
East Jakarta
156
2017
Grand Whiz Hotel Sunter
4-star
N/A
Sunter
North Jakarta
160
2017
aloft Wahid Hasyim
4-star
Upscale Class
Wahid Hasyim
Central Jakarta
170
2017
Hotel Santika Premier Yos Sudarso
4-star
Upper Upscale Class
Yos Sudarso
North Jakarta
150
2017
Morrissey Hotel
4-star
N/A
Wahid Hasyim
Central Jakarta
343
2017
Mercure Kemang
4-star
Upper Midscale Class
Kemang
South Jakarta
80
Hotel @Perintis - South Tower
4-star
N/A
Mega Kuningan
CBD Total 4-star hotel rooms
The Westin Jakarta@Gama Tower
5-star
112
Q1 2018 2018
5,426
Upper Upscale Class
Rasuna Said
CBD
283
Q2 2016
InterContinental Jakarta Pondok Indah Hotel & 5-star Residences
Luxury Class
Pondok Indah
South Jakarta
470
Q2 2016
Four Seasons
5-star
Luxury Class
Rasuna Said
CBD
365
Q3 2016
Alila - SCBD lot 11
5-star
Upper Upscale Class
SCBD
CBD
250
2016
JW Marriott @St Moritz
5-star
Luxury Class
Puri Indah
West Jakarta
208
2016
Aryaduta - Holland Village
5-star
Upscale Class
Cempaka Putih
Central Jakarta
180
Q4 2017
The Langham District 8@Lot 28 SCBD
5-star
Luxury Class
SCBD
CBD
200
2017
W Hotel @Ciputra World Jakarta 2
5-star
Luxury Class
Satrio
CBD
126
Q4 2018
Sofitel
5-star
Luxury Class
Mega Kuningan
CBD
212
2018
Regent
5-star
Luxury Class
Gatot Subroto
CBD
127
2018
Rosewood Jakarta
5-star
Luxury Class
Satrio
CBD
200
2018
St Regis
5-star
Luxury Class
Gatot Subroto
CBD
125
Q1 2019
Waldorf Astoria
5-star
Luxury Class
Thamrin
CBD
181
2019
Source: Colliers International Indonesia - Research and STR Global
37 Research & Forecast Report | Q1 2016 | Hotel | Colliers International
Total 5-star hotel rooms
2,927
Total star hotel rooms
10,515
Budget Hotel Recent times have been slow for budget hotels with only one new hotel opening during Q1 2016. Amaris Hotels, a member of Santika Hotel & Resorts has just opened the Amaris Satrio in the CBD area. The hotel provides 54 rooms bringing the total of rooms at budget hotels in Jakarta to 4,967.
Cumulative Supply of Budget Hotel (Economy Class) in Jakarta 60
50
40
30
20
2019F
2018F
2017F
2016F
2015
2014
2013
2012
2011
2010
0
2016…
10
Source: Colliers International Indonesia - Research
Budget Hotel (Economy Class) Developments in the Pipeline hotel
str global equivalent rate
location
region
rooms
projected completion time
Amaris Pluit
Economy Class
Pluit Raya
North Jakarta
112
Q2 2016
Oak Tree
N/A
Wahid Hasyim
Central Jakarta
120
Q2 2016
Fame Hotel
N/A
Grand Cakung Mall
East Jakarta
97
Q3 2016
Cordela Hotel
N/A
Kramat Raya
Central Jakarta
70
Q3 2016
Amaris Tanah Abang
Economy Class
Tanah Abang
Central Jakarta
79
Q3 2016
Whiz - Cipete
N/A
Cipete
South Jakarta
180
2016
NEO Kebayoran
Midscale Class
Kebayoran Lama
South Jakarta
102
2016
POP! Hotel Pasar Baru
Economy Class
Pasar Baru
Central Jakarta
112
2016
Luminor
N/A
Pecenongan
Central Jakarta
199
2016
Amaris Slipi
Economy Class
Letjen S Parman
West Jakarta
146
Q2 2017
Ibis Budget Jaksa
Economy Class
Jaksa
Central Jakarta
99
2017
MaxOne Hayam Wuruk
N/A
Hayam Wuruk
Central Jakarta
120
2017
Whiz Hayam Wuruk
N/A
Hayam Wuruk
Central Jakarta
200
Q1 2018
POP! Hotel Wahid Hasyim
Economy Class
Wahid Hasyim
150
Q1 2019
Central Jakarta Total budget hotel rooms
Source: Colliers International Indonesia - Research and STR Global
Performance In early 2016, Jakarta was struck by bomb and gun attacks but the situation was immediately under control. It had a short time effect on the business climate in Jakarta with an insignificant number of tourists cancelling or postponing their hotel bookings. Although the tourism industry was in a relatively stable condition, the government continued to try to convince the public that Indonesia is safe. After the bombing attack, some countries issued travel warning to their citizens about visiting Indonesia.
38 Research & Forecast Report | Q1 2016 | Hotel | Colliers International
1,786
Average Occupancy Rate in CBD
Occupancy The first quarter of each year has always been a challenging period for the hotel industry, particularly when the outlook is not that great. The Year-to-Date (YTD) overall occupancy in the Jakarta area dropped quite significantly by 14.6%, putting the AOR at 49.5% the lowest since 2013. The biggest drop of 16.4% occurred in the CBD, bringing the AOR to 49.9%. Similarly, albeit with a lower decline of 13.4%, the AOR for hotels in outside the CBD was recorded at 51.0% in 1Q 2016.
100%
The AOR of luxury class hotels, which are mainly found in the CBD area, underperformed by 18.2% as of Q1 2016, dropping to 47.0%.
40%
Similarly, a declining trend in the occupancy rate also took place in outside the CBD area for all classes of hotels. In the upper upscale class, the AOR was down significantly by 24.5% from 62.9% to 47.5%. In the upscale class, the AOR dropped by 11.5% to 55.6%.
90% 80% 70% 60% 50%
30% 20% 10% 0% 2013 Luxury Class
2014
Upper Upscale Class
2015
2016YTD
Upper Midscale & Midscale Classes+
Source: STR Global
Average Occupancy Rate Jakarta 100%
Average Occupancy Rate in Outside the CBD
90%
100%
80%
90%
70%
80%
60%
70%
50%
60%
40%
50%
30%
40%
20%
30%
10%
20%
0% 2013
2014 Jakarta
CBD
2015 Outside CBD
2016YTD
10% 0% 2013
Source: STR Global
2014
Upper Upscale Class Source: STR Global
39 Research & Forecast Report | Q1 2016 | Hotel | Colliers International
2015
2016YTD
Upscale Class
Average Daily Rate CBD Jakarta
Average Daily Rate In contrast with the AOR figure, overall, hotels in Jakarta experienced a slight increase in ADR by 2.0% YoY during Q1 2016 from USD80.59 to 82.18. In the CBD area, the ADR dropped slightly by 2.3% to USD120.28 and the ADR for hotels outside the CBD increased quite significantly by 5.9% to USD57.97. The ADR for luxury class hotels in the CBD area decreased by 7.7% YoY, dropping it to USD175.74. Despite being lower YoY, the ADR for upper upscale class was better, down 1.4%, bringing the figure for this quarter to USD119.17. The upscale class hotels maintained the ADR level at USD75.61. The upper midscale and midscale classes+ experienced a 7.7% decrease, which pushed the ADR to USD59.92. While the ADR of most hotels in the CBD decreased, the ADR in outside the CBD increased quite a bit. The upper upscale class hotels posted an 11.2% increase and lifted the ADR this quarter to USD86.38. The ADR for upscale class hotels eased 10.8% to USD63.32. For most hoteliers, the beginning of the year might be described as a warm-up period. Particularly at the start of this year, the hotel business was looking for momentum to perform better than last year.
USD200.00
USD160.00
USD120.00
USD80.00
USD40.00
USD0.00 2013
2014
2015
2016YTD
Luxury Class
Upper Upscale Class
Upscale Class
Upper Midscale & Midscale Classes+
Source: STR Global
Average Daily Rate Outside the CBD Jakarta USD90.00
Average Daily Rate Jakarta
USD75.00
USD150.00 USD60.00 USD120.00 USD45.00 USD90.00
USD30.00
USD60.00
USD15.00
USD0.00
USD30.00
2013
2014
Upper Upscale Class
USD0.00 2013 Jakarta
2014 CBD
2015
2016YTD
Source: STR Global
Outside CBD
Source: STR Global
40 Research & Forecast Report | Q1 2016 | Hotel | Colliers International
2015 Upscale Class
2016YTD
554 offices in 66 countries on 6 continents
Primary Authors: Ferry Salanto Associate Director | Jakarta 62 21 3043 6730
[email protected]
United States: 153 Canada: 34 Latin America: 24 Asia : 39 ANZ: 192 EMEA: 112
$2.5
billion in annual revenue
Colliers International Indonesia World Trade Centre 10th & 14th Floors Jalan Jenderal Sudirman Kav. 29 - 31 Jakarta 12920 Indonesia TEL 62 21 3043 6888
2
billion square feet under management
16,000
professionals and staff
About Colliers International Group Inc. Colliers International Group Inc. (NASDAQ: CIGI; TSX: CIG) is an industry leading global real estate services company with more than 16,000 skilled professionals operating in 66 countries. With an enterprising culture and significant employee ownership, Colliers professionals provide a full range of services to real estate occupiers, owners and investors worldwide. Services include strategic advice and execution for property sales, leasing and finance; global corporate solutions; property, facility and project management; workplace solutions; appraisal, valuation and tax consulting; customized research; and thought leadership consulting. Colliers professionals think differently, share great ideas and offer thoughtful and innovative advice that help clients accelerate their success. Colliers has been ranked among the top 100 outsourcing firms by the International Association of Outsourcing Professionals’ Global Outsourcing for 11 consecutive years, more than any other real estate services firm. colliers.com/indonesia
Copyright © 2016 Colliers International. The information contained herein has been obtained from sources deemed reliable. While every reasonable effort has been made to ensure its accuracy, we cannot guarantee it. No responsibility is assumed for any inaccuracies. Readers are encouraged to consult their professional advisors prior to acting on any of the material contained in this report.
Accelerating success.
