The latest market insight about all property market sectors, including office building, retail, and industrial space
Ongoing economic challenges and global geopolitical tensions continue to create uncertainty in the market. As a result, some companies are taking more cautious and strategic steps as in downsizing their office space or seizing the opportunity to expand or relocate to higher-quality offices to more favorable locations and favorable rental rates.
Download PDF PDF | 2.69MB
Indonesia's resilient economic outlook, despite global geopolitical tensions and market uncertainties, is expected to underpin positive sentiment in the Jakarta office market for the coming years. As the nation's financial and commercial hub, Jakarta's strategic importance continues to fuel its growth trajectory.
As this country is expected to hit economic growth of 5.2% this year, market sentiment remains positive. As the market has normally run, demand for office space is projected to remain moderate with positive absorption for the rest of this year. Some new supplies are slated to complete and might bring pressure on the occupancy rate, especially in the OCBD. In parallel, CBD market is expected to increase due to the absence of new office supply.
Following the conclusion of the presidential election, some companies have initiated office space expansions or renewals. Despite the increasing demand this quarter, landlords have refrained from raising base rents due to the imminent completion of new buildings in this market. In the meantime, high-quality office spaces near public transportation are becoming scarce, prompting some companies to explore office options in other locations to meet their needs.
Despite the ongoing trends of hybrid working, the conclusion of the conducive presidential election in February has begun to stimulate movement among companies due to increased employee traffic, prompting expansion or the resumption of delayed plans to set up new offices in the Jakarta office market. As landlords continuing to offer competitive rental packages to maintain market attractiveness, further growth in office space demand is anticipated in the upcoming quarter. Leasing volume is expected to move towards pre-pandemic level, as a result of improved macroeconomic landscape and office demand over some consecutive quarters. Despite the uptick in demand, yet, particular numbers of lease currently being executed still indicate a trend towards downsizing, albeit at a gradual declining rate, whilst inquiries for higher office building quality are expected to increase as occupiers continue to strive to comply with ESG goals.
Description