Southeast Asia Outlook 2023

MARKET STATISTICS

OFFICE (CBD GRADE A)

WAREHOUSE (GREATER JAKARTA)

LANDED-RESIDENTIAL (GREATER JAKARTA)

RETAIL (CBD)

13.14

63.40

4.76

Base Rents/Price Q4 2022 (USD psm pm) 2023 Forecast

Selling Price: 815 psm

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INDONESIA: GREATER JAKARTA MA R K E T S NA P S H OT

28.8%

22.6%

10.9%

Sales Rate: 94.5%

Vacancy/Sales Rate Q4 2022 2023 Forecast

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Current Inventory

5.1 Million sqm

1 Million sqm

2.1 Million sqm

416,500 Units

Pipeline Supply (2023-2027)

0.3 Million sqm

0.05 Million sqm

0.8 Million sqm

62,000 Units

% of Current Inventory (Pipeline Supply over Current Inventory)

ECONOMY

6.0%

4.6%

38.4%

14.8%

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In the face of a global slowdown and inflationary pressures, the central bank forecasts Indonesian growth of 4.5% to 5.3% in 2023. This expansion is primarily driven by increased consumer expenditures, increased business activity, and improved mobility as a result of fewer COVID-19 restrictions in the country. However, following the high inflation that drove price increases in 2022, as well as the planned election in 2024, the Rupiah is still expected to depreciate to some extent between 2023 and 2024.

Capital Value Outlook

*Prime units: Retail units that enjoy strong footfalls with good frontage and accessibility

RECENT SIGNIFICANT DEALS

INVESTMENT OPPORTUNITIES

1. LANDED HOMES: Following the pandemic, market confidence in landed residential products has steadily improved, with the Middle and Upper segments accounting for the majority of demand. Driven by the primary needs of Indonesia’s large population, an increase in general purchasing power post pandemic, and the fact that most demand comes from end-users purchasing their first homes, landed residential demand is projected to continue to be relatively steady in 2023, despite the global economic concern. 2. INDUSTRIAL AND WAREHOUSE: The availability of industrial land in favourable area becomes more limited, and the demand from high-tech industries such as data centers, and electric vehicles remain. Aside from the low vacancy rate of the warehouse market and growing logistics sector, and there is increasing demand from other sectors

such as manufacturing, raw materials, and automotive. Rent is expected to be stable due to high market competition, and incoming new supplies, which indicates the warehouse market is still considered attractive for investors. 3. RETAIL: Although economic growth accelerated during the last quarter of 2022, the on-going elevated consumer price, inflation, and rising interest rates are expected to balance off household spending in the subsequent year. Positive net absorption of retail space is expected to continue in 2023 along with the return of visitor traffic to pre pandemic level. Rental rate and service charge are expected to remain stable in 2023 as landlords will continue their efforts to maintain and attract new retailers.

PROPERTY NAME

PROPERTY TYPE

PRICE (MIL USD)

BUYER

SELLER

DATE

Central Park Mall Jakarta (71% stake)

Agung Podomoro Land TBK

JOIN, Hankyu Hanshin

Retail

201.5

Q3 2022

Portfolio of 4 Data Centers

Indosat Ooredoo and Lintasarta JV

BDx

Data Center

293

Q2 2022

Source: RCA, Cushman & Wakefield Research

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Southeast Asia Outlook 2023: Bouncing Back Stronger | 26