Rental Apartment Q4 2021
Supply: Additional 177 Units of Serviced Apartment Supply
One new Serviced Apartment project entered the Jakarta Rental Apartment market in the fourth quarter of 2021. Somerset Sudirman, located at Bendungan Hilir, Sudirman, Jakarta, added 177 units to the Jakarta’s Serviced Apartment existing supply, bringing the total supply to 5,760 units, as of end of Q4-2021. Meanwhile, several under construction Serviced Apartment projects, such as Somerset Kencana, Citadines Gatot Subroto, Citadines Sudirman, and Ascott Menteng which were initially expected to commence operations by 2021, have been delayed due to the continuing COVID-19 pandemic.
Demand: Short-Stay Demand Helped to Balance Occupancy Rate
Purpose-built Rental Apartments sub-sector was impacted by the expired lease contracts during the review quarter. Occupancy was recorded at 54.6%, a slight 0.6% decrease compared to the last quarter’s figure. However new demand enquires for next quarter was started to be identified during the review quarter, which is expected to lead to better occupancy in 1st quarter of 2022.
In Serviced Apartment sub-sector, as local travel & work restrictions were eased by the implementation of PPKM level 2, demand inquiries from short-stay guests for weekend “staycation” and Christmas holiday significantly increased the occupancy rate by 7.1% QoQ to 54.8% during the review quarter. If compared to the last year’s figure, the occupancy rate reflected about 7.4% occupancy increase.
Demand for Condominium-for-lease sub-sector was relatively stable during Q4 2021. Occupancy rate experienced only slight increase of 0.2% QoQ, to 45.1% during the review quarter. This figure still reflected 9.1% occupancy decrease if compared to the same period of 2020. With the expected additional supply from newly completed projects in the next quarter, occupancy rate of the Condominium-for-lease sub-sector is projected to decrease.
New confirmed COVID-19 cases of Omicron variant which started to increase towards the end of the year is expected to continue to the early 2022 and will cause the decrease of occupancy rate of the rental apartment sector in the next quarter, as stricter restrictions will be applied on community activities.
Pricing: Rents Remained Under Pressure
Despite the fluctuation of the Rupiah against US Dollar during the review quarter, average rentals of Purpose-built Rental Apartments, Serviced Apartments and Condominium-for-Lease sub-sector remained relatively unchanged at Rp. 239,339, Rp. 356,576 and Rp. 139,699 per sqm per month respectively. Rental rate discounts, subject to negotiation, were still offered by most projects to attract new demand. Overall, the average rental rate is projected to remain under pressure throughout 2022.
Industrial Q4 2021
Supply: New Industrial Land Supply in Bekasi
The new supply of industrial land comes from industrial estate in the eastern part of the Greater Jakarta area. Despite the pandemic situation, two industrial estates along the eastern corridor added their industrial land supplies, as industrial land availability in favorable location becomes more limited. Two industrial estates in Bekasi, added about 105 hectares and 30 hectares, respectively, to their land supply during the review quarter, bringing the total industrial land inventories in the Greater Jakarta area to 15,908 hectares.
This indicates the optimism of developers on the potential of the Greater Jakarta industrial sector. Developers are observed to still look for opportunities whilst closely monitor the market and the related government policy, including the impacts of the Covid-19 pandemic on the market.
There is no addition of warehouses for lease in the Greater Jakarta area, holding the total supply of warehouse for lease at 1.97 million sqm. Until end of 2022, about 140,000sqm of warehouse spaces are in the pipeline to enter the market.
