CBD Property Market Update for Q2 2011

As predicted in Q1 2011, the property market will continue to enjoy a strong growth this year due to healthy economic growth and political stability in Indonesia. This is especially true in the Central Business District of Jakarta, according to various market reports from prominent property management and consultant companies such as Jones Lang LaSalle, Coldwell Banker, and Procon.

In the commercial sector of the CBD market, the absorption rate for office space by mid-year 2011 has reached 99,000 m2, compared to just 50,000 m2 in 2010. A total absorption of 150,000 m2 of office space is expected by the end of 2011. With an occupancy level of 87%, the rental rate has also enjoyed a significant growth.

As for the residential sector, mainly condominiums in the CBD area, sales in 2011 is projected to double that of 2010. As per mid-year 2011 sales of new condominiums has reached around 3,700 units, which is almost equal to the sales of full-year 2010. Rental rate has also grew 13% compared to last year, which is mainly due to the strengthening of the IDR to the USD.

In the secondary market, Century 21 Ambassador has seen significant increase in inquiry rate for both commercial and residential market in CBD. For the commercial sector, while growing at 13% in 2011 inquiry rate to buy/ sell has tripled that of lease, compared to just double in 2010. In the residential sector, inquiry to buy/ sell grew 102% compared to 2010, while growth of inquiry to lease is almost flat at 3%.

Both the primary and secondary markets in CBD have shown great potential and momentum for many years to come. The time to invest is now. Century 21 Ambassador is here and ready to assist you.

Indonesia Property Outlook 2011

The Indonesia property market is set for a consecutive bullish year in 2011. Two important factors that will play a major role in real estate double digits growth this year are Indonesia’s promotion to investment grade status and real estate foreign ownership reform. These two drivers will ensure a strong and stable growth in Indonesia’s property market for years to come.

Achieving investment grade status means that Indonesia is recognized as a reliable and stable borrower of funds. Currently set at BB by S&P, Indonesia is just one step away to achieving investment grade status. Higher Foreign Direct Investment (FDI) and optimism from local corporates will boost economic activity and growth, which in turn will positively affect the local property market.

Relaxation of foreign ownership restriction on real estate in Indonesia has been intensely advocated by both local and foreign interest parties, such as REI and FIABCI. Comparing to other major cities in Asia, Jakarta property market is still undervalued, but with higher rental yields. A more relaxed foreign ownership lay will certainly boost the overall property market in Indonesia.

The CBD Jakarta market has also enjoying strong consecutive growth. As an indicator, Century 21 Ambassador’s revenue growth in 2010 vs 2009 is at 44%, driven largely by increasing number of apartment rentals by expatriates and investments and rental of commercial and office space by both local and foreign corporates. Century 21 Ambassador is your best partner in CBD Jakarta. Have a great year in property!