New office space in Jakarta hits record high

JAKARTA. There was a significant increase of office supply located in the central business district (CBD) and non-CBD areas in 2012, amounting to 547,070 square-meter spaces, which is the largest supply since the 1998 economic crisis, according to data from Colliers International published on Tuesday.

Associate research director Ferry Salanto attributed the strong growth to the increasing expansions of businesses to Jakarta.

“Jakarta is currently an emerging investment and development destination for many corporations with products such as finance, banking, insurance, mining and automotive. The demand is assisting the performance of the office market,” Ferry said in Jakarta on the sidelines of Jakarta Property Overview.

He said that in the CBD alone, total new office space in 2012 accounted for 289,514 square meters, a double jump from the amount in 2011.

In mid 2012, three high rise buildings AXA Tower, Multivision, Office 8 and mid-rise buildings Indosurya Plaza and 18 Office Park Tower D were in operations, bringing a total of 144,073 square meters of new office space to the CBD area.

In the following quarter, the World Trade Center II accounted for an additional 57,000 square meters. Subsequently, the operation of Tower One at The City Center and Tower C at 18 Office Park supplied another 88,441 square meters.

“The high demand from the market also increased the occupancy rate in the CBD area to 97.3 percent at the end of last year,” he said.

The annual new supply in non-CBD areas, especially along Jl. TB Simatupang in South Jakarta, has grown significantly from the previous year.

During 2012, eight new office buildings including Menara Satu, Wisma Pondok Indah 3, Grand Slipi Tower and Sovereign Plaza, contributed 257,556 square meters to Jakarta’s new office spaces.

“Since 2010, new office supply outside the CBD area has rapidly grown as a result of the limited supply and continuous demand in the CBD area. West and South Jakarta were the most active areas to supply new offices in the last two years,” he went on.

Office supply in the capital city is projected to continue growing throughout 2013 despite the government’s plan to increase electricity tariffs by 4.3 percent once every three months because businesses needed to expand, he went on.

Colliers International also projects an increase in office spaces from 2014 to 2016. During that time, the annual supply will be 50 to 60 percent higher than in 2012.

“Many developers have made the decision to enter or further expand their respective businesses in 2011 and 2012 because they want to see how strong the market will grow. Thus, we will see a lot of new projects from 2014 to 2016,” he continued.

According to its data, there are 47 new office buildings that will be completed and be ready to enter the market from 2014 to 2016.

In the CBD area, the projects include Chase Tower on Jl. Jend. Sudirman, Life Tower on Jl. HR Rasuna Said, Wisma Mulia 2 on Jl. Gatot Subroto, Ciputra World Jakarta 2 in on Jl. Prof. Dr. Satrio and The Noble House Office Tower in the Mega Kuningan area.

Outside the CBD area, the capital will see completion of The Suites in Pantai Indah Kapuk in North Jakarta, Sky 18 Tower in Kalibata in South Jakarta, St. Moritz Office Tower in Puri Indah in West Jakarta and Beltway Office Park Tower 3 on Jl. TB Simatupang in South Jakarta. (Nurfika Osman/ The Jakarta Post)