Even though Debotabek retail centers are still on downward trend until the end of 2021, the picking up traffic of the malls across Greater Jakarta in the past three months and the start of the third booster shot program within the nation have brought up the optimism of the landlords and retailers. Demand in the upcoming year is expected to gradually increase, certainly with the hope of no other overwhelming COVID-19 wave in Indonesia.
Pricing: No Price Movement at Least Until the First Quarter of 2022
Average base rental rate of Debotabek retail space remained unchanged from that in the last year, standing at Rp 451,800/sqm/mo, for specialty retail space on the Ground Floor. Service charge also remained unchanged from that in the last year, landing itself at Rp135,000/sqm/mo. Similar to that of Jakarta retail centers, the review of individual tenant’s pandemic-circumstances on a case-by-case basis is still in forced, but in a relatively less amount. Landlords in Debotabek Retail Centers have
foreseen that neither rental rate nor service charge will experience an increase in the first quarter of 2022, or at least until COVID-19 can be contained within the region.
Condominium Q4 2021
Supply: New Project Completions Increased
Fifteen projects are completed during the last quarter of 2021, adding 8,267 units of new supply, an increase of 2.47% in total existing supply from that in the previous quarter. Despite the implementation of stricter public movement policy (PPKM Darurat) in mid 2021 that caused halted construction of some of the projects, the total YTD new supply delivery of 27,423 units was 42% above YTD completions in the corresponding period last year.
Meanwhile, the number of proposed condominium projects declined by 6.2% since the third quarter as developers deferred project launches to 2022. Only 3 projects were launched to the market in the review quarter, namely Rainbow Springs CondoVillas – Orange (Tower 12,15), Creativo Bintaro, and Marigold Navapark Tower 7, comprising 839 units. Most developers are still focusing on marketing of the existing units , taking the opportunity from the implementation of government’s incentive that waives value-added taxes on ready stock residential.
Demand: Lower Overall Take Up Rate Than That in 2020
A net take-up of 1,900 units was recorded in the last quarter of 2021 from both completed and proposed projects, 452% higher than the total units absorbed in the last quarter of 2020 (YoY). However, the total units absorbed in 2021 were still lower than those taken up in 2020, from 9,317 units in 2020 to 7,732 units in 2021 (-17% YoY).
This shows that despite the quarterly improvement of the take-up, the overall condominium market has yet to recover from the pandemic effect. The cumulative condominium sales rate slightly increased from 93.3% in 2020 to 93.9% (0.6% YoY), whilst the pre-sales rate decreased by 4.2% from 61.7% in 2020 to 59.1%.
By the end of the quarter, the average vacancy of the market decreased by 4.9% from 52.2% in the third quarter to 49.6%, in line with the ease of local travel & work restrictions and the implementation of PPKM level 2.
Pricing: Slightly Increasing Sales Price
Greater Jakarta’s average price growth in the last quarter of 2021 was recorded at Rp. 43,700,000 per sqm, slightly increase by about 0.7% from that in the third quarter. Most developers offered many promotions to boost sales such as fully furnished package, booking fee discount, and rental guarantee in addition to the VAT waiver incentives from the government. The condominium sales price is projected to increase in 2022 as the government are planning to increase the VAT rate to 11% per April 2022.
