Southeast Asia Outlook 2024

Southeast Asia Outlook 2024: Opportunity Beckons

CUSHMAN & WAKEFIELD

MARKET STATISTICS

OFFICE (GRADE A&B)

RETAIL (SHOPPING CENTER)

LOGISTICS (GREATER JAKARTA)

RESIDENTIAL (LUXURY CONDOS)

Rents Q4 2023 (IDR psf pm) 2024 Forecast

Selling Price 1,125,573 psf

26,965

91,507*

7,160

X

X X

X

X

26.4%

21.4%^

X 14.0%

Sales Rate: 94.3%

Vacancy Q4 2023 2024 Forecast

X

X

X X

Current Inventory (million sf)

56

50.6^

28.6

431,992 units

INDONESIA: GREATER JAKARTA MARKET SNAPSHOT

Pipeline Supply (million sf)

1.4

1.1

4.9

39,662 units

Pipeline supply over Current Inventory Ratio (%)

2.5%

2.1%

17.2%

9.2%

X X X

Capital Value Outlook 2024

X

ECONOMY

X

Source: Cushman & Wakefield Research

• Indonesia’s economic growth is expected to reach about 5.0% in 2024, similar to 2023, albeit growth will remain tempered by global financial and economic condition. • Indonesia continues to see strong private consumption and attract healthy FDI inflows of about USD 47 billion, a 13.7% yoy increase. FDI was significantly driven by investments: base metal industry and mining attracted 25% and 10% of FDI respectively, into the energy transition space, given Indonesia’s supply of nickel, a key ingredient for electrical vehicle batteries. • Despite a 6% increase in 2023, a projected decline in the central bank rate for 2024 suggests a move toward more favorable borrowing terms, potentially boosting the property market, though the crucial political context acknowledges that changes in government policy post-election could influence the central bank’s decisions.

*Primary retail area in Jakarta for premium Ground Floor rents ^ Retail vacancy and Inventory of overall Jakarta retail market, both primary and secondary area

RECENT SIGNIFICANT DEALS

PROPERTY NAME

PROPERTY TYPE

Price (mil USD) / US $PSF

NET YIELD (%)

BUYER

SELLER

DATE

CAPITAL MARKETS ANALYSIS

Hankyu Hanshin Properties

Agung Podomoro Land TBK

Neo Soho Mall

Retail

93/ 135 psf

-

Q3 2023

1. OFFICE : Despite rents is expected to gradually improve, transaction will likely remain sluggish as the yield is still relatively low for typical investors. 2. RETAIL: International brands seek expansion, landlords retain tenants and explore new opportunities, while emerging retail facilities support Transit-Oriented Developments (TOD) in the trend of integrated spaces.

3. LOGISTICS: Despite the tight competition for the market, and new supply continue to enter the market, it has maintained low vacancy rate. The expectation for rental prices is to remain steady due tight competition in the market. 4. RESIDENTIAL: Government VAT incentives for ready stock houses will be one of the main driving factor for demand. Advancements in infrastructure facilities within the Greater Jakarta is anticipated to contribute to a subsequent rise in land prices.

Ascott Kuningan Jakarta

CapitaLand Investment

Serviced Residence

CapitaLand Ascott Trust

41/ NA

6.7%*

Q3 2023

Mandarin Oriental Jakarta

Mandarin Oriental Jakarta

Astra International

Hotel

88/ NA

-

Q3 2023

Source: RCA, Cushman & Wakefield Research

*Forward Yield

32

33