Research Jakarta Property Highlights First Half Contents Economy at a Glance 1 Office Market 2-3 Retail Market 4-5 Condominium Market 6-7 Residential Office Rental Apartment Market 8 Hotel Market 9-1 Retail Hotel Executive Summary Most macroeconomic indicators continued to improve in the first half of with GDP growth recorded at 6.1% and is projected to maintain at above 6% by end of the year. Nevertheless, there is a growing concern over the impact of the US subprime mortgage crisis on the global economy, including Indonesia. The increase of new supply in the first half had no impact on the overall office occupancy level, which stayed at 88%. The high pre-commitment rates for newly completed buildings, combined with good improvement of net take-up, have been the main contributors to stable occupancy, which resulted in an increase of both base rentals and service charges. However, the overall occupancy level -especially for older buildings- is projected to decline due to completion of new supply by end of the year. The overall retail occupancy level remained stable in the first half of. Several new foreign retailers are committed to opening up outlets by end of the year, including Kidzania and Harvey Nichols, indicating a positive outlook towards the retail market in Jakarta. Average gross rental rates slightly declined due to Rupiah fluctuation, but are expected to remain stable for the rest of the year. However, overall occupancy is expected to decline in due to the completion of new supply. Net take-up of condominium projects slightly improved in the first half of, supported by declining interest and inflation rates. Nevertheless, the increasing supply has resulted in slower takeup in existing projects. Demand is expected to remain stable. However, the market will become more competitive with substantial new supply coming on stream by end of, in existing projects. Overall occupancy increased in both serviced and non-serviced apartment to 85.7% and 87.19%, respectively. Asking gross rental rates for non-serviced apartments increased slightly, whilst asking gross rentals for service apartments remained stable. Serviced apartment occupancy is projected to decline, in view of the large supply coming on stream in the next two years. Limited suppply, coupled with improved business confidence, has increased the occupancy and average room rate of 3,4 and 5 star hotels. The 3-star sub-market enjoyed the highest occupancy rate. Average Room Rate and occupancy is projected to remain stable in in all sub-markets.
1 Jakarta Property Highlights - First Half Knight Frank Economic growth continued to improve, but there is a growing concern over the impact of the US subprime mortgage crisis on Indonesia Figure 1 GDP Growth vs Inflation Rate (Year 22-1H) 18% 16% 14% 12% 1% 8% 6% 4% 2% % Source: Central Bank of Indonesia Figure 2 GDP Growth Exchange Rate / US$1 (2H 21-1H ) Rp12, Rp11,5 Rp11, Rp1,5 Rp1, Rp9,5 Rp9, Rp8,5 Rp8, Source: Central Bank of Indonesia Figure 3 Inflation Rate Interest Rate (1-month SBI Rate) (2H 21-1H ) 19% Economy at a Glance GDP Growth Indonesia's economic fundamentals continued to improve throughout the first half of. GDP growth increased to 6.1% (y-o-y) in the first half of. GDP growth is expected to remain at above 6% by the end of, continuing a trend of steady improvement recorded over the last 3 consecutive years. Indonesia's stable macroeconomic performance has been attributed to benign inflation, declining interest rate and improvement in business and consumer spending. The sectors that achieved the highest growth were transportation and communications (11.6%), followed by electricity, gas, and water (9.5%) and construction (8.6%). Despite the improving macroeconomic indicators during the first half of, there is a growing concern over the impact of the US subprime mortgage crisis on Indonesia. Exchange Rate The exchange rate remained stable during the first half of. The Rupiah reached its highest appreciation for the last 12 months at Rp.8,828 per US$1 in May, due to the good balance of payment, before depreciating to Rp 9,54 per US$ 1 at the end of June. Inflation The inflation rate had been showing a declining trend from 6.6% in December 26 to 5.77% in June, which has spurred the consumption. Household income has started to increase in real terms, creating opportunities in the property sector. The declining inflation was influenced by the falling 1-month SBI rate and Consumer Price Index, due to the great harvest season in May. However, inflation is expected to increase in the second half of the year. Interest Rate The continuing downward trend of the 1-month SBI rate from 9.75% to 8.5% during the last six months, followed by the decline in the lending rate to approximately 14%, is expected to stimulate the growth of the property sector. Investment Investment planning approvals in the first half of increased significantly compared to the first half of 26. Domestic investment planning approvals reached Rp 11,67 billion, or 65% higher than that in the first semester last year, whilst foreign investment planning approvals were recorded at US$ 21,993 million, or increased by 268% from the first semester 26 level. The realized domestic and foreign investment also increased to Rp 18,617 billion and US$ 3,76 million, or an increase of 77.9% and 18.2%, respectively. Economic Indicators 17% 15% 13% 11% 9% 7% Indicator 22 23 24 25 26 1H 1 GDP 4.88% 4.7% 5.3% 5.6% 5.5% 6.1% Inflation 1.3% 5.6% 6.4% 17.11% 6.6% 5.77 % 5% Source: Central Bank of Indonesia 1-month SBI Rate 13.1% 8.39% 7.43% 12.75% 9.75% 8.5% Figure 4 Investment Approvals (Year 22-1H) 2, Foreign Investment (US$ million) Exchange Rate Rp.8,94 Rp. 8,465 Rp. 9,29 Rp. 9,83 Rp. 9,2 Rp. 9,54 (per US$-end of year) Foreign Investment Planning Approvals 15, 1, 5, Domestic Investment (Rp Billion) No. of Projects 1,233 1,231 1,219 1,648 1,718 82 Value (US$ million) 9,953.5 14,197. 1,366.9 13,579.2 15,659.1 21,993.3 Domestic Investment Planning Approvals 22 23 24 25 26 Source: Investment Coordinating Board www.knightfrank.com 1H No. of Projects 194 23 197 218 225 116 Value (Rp. Billion) 25,831.9 54,11.8 43,336.7 5,557.3 162,767.2 11,66.9 Source: Processed from Multiple Sources by Knight Frank / PT. Willson Properti Advisindo 1 at Year 2 Constant Price
Knight Frank Jakarta Property Highlights - First Half 2 Total existing stock increased to 3.37million sq-m Figure 5 Jakarta Office Market Supply & Demand (21-1H) 3,5, 3,, 2,5, 2,, 1,5, 1,, 5, Figure 6 Occupancy Rate by Office Grade (1H 22-1H ) 95% 9% 85% 75% 7% Figure 7! " # Cumulative Supply Asking Gross Rental Rates in Rupiah Term by Office Grade (1H 22-1H ) Cumulative Demand Occupancy Rate 9% 88% 86% 84% 82% 78% 76% 74% 72% Premium Grade A Grade A Grade B Grade C Premium Grade A Grade A Grade B Grade C $ % Good improvement in net take-up Office Market Supply The completion of Indofood Tower, Plaza Marein and Menara Karya has added to the office inventory by 84,578 sq-m, increasing the total existing stock of office space to approximately 3.37 million sq-m in the first half of. Total proposed office supply in - is 615,284 sq-m, 41% of which is scheduled for completion this year. Some project completions in may be delayed. 63% of the proposed supply comprises rental office buildings, 19% represents strata-title offices and the remaining 18% of the buildings offer both rental and strata-title office space. Table 1 Future Office Supply Completion Schedule (Year - ) Year Office Name Senayan City (2 Tower) The East (Previously Menara Orienta) Menara Satrio Menara Prima Pacific Place Sentra Senayan 2 Menara Palma (Previously Kuningan Office Tower) Lettable Area 35,91 sq-m 44,26 sq-m 4, sq-m 48, sq-m 22, sq-m 6, sq-m 35, sq-m Location Senayan Mega Kuningan Dr. Satrio H.R Rasuna Said S Senayan H.R Rasuna Said Grand Indonesia Bakrie Tower Graha Energi Kota Kasablanka 8, sq-m 7, sq-m 65,283 sq-m 49,65 sq-m M.H Thamrin H.R Rasuna Said Sudirman Casablanca City Tower 66, sq-m M.H. Thamrin Demand Total 615,284 sq-m Type Strata & Strata Strata & With the good improvement in net take-up, the market occupancy remained at around 88%, despite the increase in supply. Overall vacancy stood at 48,877 sq-m. The increase in occupancy occurred in most submarkets. However, the occupancy of the Grade-A submarket declined slightly due to the increase in supply in this segment. Newly completed office buildings and those that are scheduled for completion in have managed to achieve high pre-commitment rates, indicating steadily improving market confidence. However, tenant relocation remained the major demand generator for new office buildings. Many tenants continue to look for better quality premises by relocating to newer or higher-grade office buildings. New office demand came from Asian companies setting up their representative offices in Jakarta. Active business sectors that generated office demand during the first half of include trading, IT/telecommunications, banking/finance and consumer goods. Table 2 Jakarta Office Market Highlights 1H - Office Type Total Existing Supply Occupancy Rate Vacant Space - Rental Office 2,867,666 sq-m 87.21% 366,644 sq-m - Strata-title Office* 344,6 sq-m 88.99% 37,883 sq-m - Owner Occupied Office 155,21 sq-m 97.19% 4,349 sq-m Total 3,366,748 sq-m 87.86% 48,877 sq-m * Some portion of the strata-title office space have been offered for lease New buildings have achieved high pre-commitment rates
3 Jakarta Property Highlights - First Half Knight Frank Both base rentals and service charges increased in all submarkets Figure 8 Asking Gross Rental Rates in US Dollar Term by Office Grade (1H 22-1H )! ' % #! ' % #!! " " # # $ Premium Grade A Grade A Grade B Grade C Strata-title office sales also improved Figure 9 Average Asking Selling Price of Strata-Title Office (1H 22-1H ) Rp14,, $ % $1,7 Rents and Prices Both base rentals and service charges increased in all submarkets. Asking gross rentals increased by 2.8% in Rupiah terms to Rp.152,153 per sq-m per month, or rose by 2.4% in US Dollar terms to US$16.81 per sq-m per month. As the interest rate continued its downward trend, the first half of saw an increase of take up of stratatitle office sales. As a result, the average price of strata-title office buildings increased slightly to Rp.13.2 million (US$1,455) per sq-m. Table 3 Asking Base Rental Rates and Service Charges by Office Grade (1H ) Office Grade Base Rental /sq-m *SC/sq-m Changes from Gross Rental /sq-m 2H 26 Rupiah US$ Rupiah US$ Rupiah US$ Rupiah US$ Overall Rp. 96,811 $1.69 Rp.55,342 $6.11 Rp.152,153 $16.81 2.8% 2.4% Premium Grade-A Rp.131,755 $14.55 Rp.63,265 $6.99 Rp.195,2 $21.54 1.4% 1.1% Grade-A Rp. 96,712 $1.68 Rp.57,182 $6.32 Rp.153,894 $17. 4.% 3.6% Grade-B Rp. 73,262 $ 8.9 Rp.46,383 $5.12 Rp.119,645 $13.21 1.3%.9% Grade-C Rp. 6,95 $ 6.73 Rp.37,39 $4.12 Rp. 98,259 $1.85 2.5% 2.2% US$1 = Rp.9,54 *Service Charge Market Outlook With the completion of new supply, overall occupancy is expected to decline by the end of. As tenants continue to trade up, newly completed office buildings offering reasonable rental rates are expected to enjoy high occupancy, as shown by their high pre-commitment rates to date. Older buildings with low occupancy rates may need to either renovate or offer competitive rents in order to maintain their tenants. Meanwhile, both base rentals and service charges are likely to remain stable in. Rp13,5, Rp13,, $1,5 $1,3 Rp12,5, Rp12,, $1,1 $9 Rp11,5, $7 Rp11,, $5 Strata Price (Rp.)/sq.m Strata Price (US$)/sq.m Older buildings with low occupancy may need to renovate or offer good rental packages to attract tenants www.knightfrank.com
Knight Frank Jakarta Property Highlights - First Half 4 Overall occupancy remains stable at 85.2% Retail Market Supply The Jakarta retail market witnessed the completion of Belleza Shopping Arcade and Kalibata Mall 2, adding up the cumulative supply to 2.88 million sq-m during the first half of. The total existing supply comprised 5.9% retail centres for lease and 49.1% strata-title retail centres. By sub-market, Grade-B retail centres held the largest share of 43.9%, followed by Grade-C with 31.9%. Meanwhile, the Premium Grade- A retail centres accounted only for 7.3% and Grade-A retail centres had 17.%. This distribution will change with 2 major lease centres in the projected to come on stream during the second half of. Figure 1 Jakarta Retail Market Supply and Demand (1H 24-1H ) 3,, 2,5, 2,, 1,5, 1,, 95% 9% 85% 75% By the end of this year, the market is expected to see an additional new supply of 272,13 sq-m from 3 lease centres and 2 strata-title centres. Contributing nearly 4% of the proposed supply in, the entire Grand Indonesia will be opened in the fourth quarter of, following the operation of its anchors, Seibu department store and Megablitz cinema commencing earlier in the second quarter of. Adding to these, Pacific Place and Grand Paragon (previously Gajah Mada Square) are other major retail centres for lease that are planned for completion in the next semester. By, future supply is projected to reach 1,17,919 sq-m with nearly 6% or 587,782 sq-m coming from lease retail centres. Of total proposed supply in -, approximately 25.5% or 259,5 sq-m will come from proposed projects in the. 5, 1H4 2H4 1H5 2H5 1H6 Cumulative Supply Cumulative Demand Figure 11 7% 65% 2H6 1H7 Occupancy Rate Occupancy Rate of Shopping Centres by Grade (2H 23-1H ) 1% 95% 9% 85% 75% 7% Table 4 Future Supply Completion Schedule (-) Year Project Name Grand Paragon (Previously Gajah Mada Square) Grand Indonesia Pusat Grosir Jatinegara Pacific Place Pusat Grosir Cililitan 2 Kelapa Gading 5 (Previously MKG 3 EXT) Jatinegara Lexy Square Sudirman Palace Citywalk Ritel at Cityloft Pluit Junction Season City (Previously Latumanten City) Plaza Indonesia 2 Plaza Emporium Pluit Galeria Glodok Rasuna Episentrum Blok M Square Gandaria Main Street Kelapa Gading Square (Mall of Indonesia) ITC Pasar Minggu Kota Kasablanka Total Retail Type Strata Strata Strata & Strata Strata Strata & Strata Location Total Supply 62,75 sq-m 18, sq-m 12,38 sq-m 72, sq-m 17, sq-m 17, sq-m 18, sq-m 28, sq-m 2, sq-m 21, sq-m 6, sq-m 25, sq-m 64, sq-m 13, sq-m 26,5 sq-m 11,757 sq-m 75, sq-m 147,5 sq-m 38, sq-m 82,32 sq-m 1,17,919 sq-m Premium Grade A Grade A Grade B Grade C Table 5 Summary of Future Supply (-) Overall rental levels slightly declined mainly due to exchange rate fluctuation Year d Retail 242,75 sq-m 188, sq-m 157,32 sq-m Total Proposed Supply - Strata-Title Retail 29,38 sq-m 197,257 sq-m 38, sq-m & Strata- Title Retail - 18, 147,5 Total Supply 272,13 sq-m 43,257 sq-m 342,532 sq-m 1,17,919 sq-m
5 Jakarta Property Highlights - First Half Knight Frank Overall occupancy is expected to decrease slightly due to the large supply coming on stream by end of this year. Figure 12 Asking Gross Rental Rates of Ground Floor Shopping Centres in Rupiah by Grade (2H 23-1H ) Rp1,43, Rp1,23, Rp1,3, Rp83, Demand During the review period, the occupancy of Premium Grade-A sub-market declined from 94.2% in December 26 to 87.6%, due to the downsizing of SOGO in Plaza Indonesia. Improved occupancy was seen in Grade-A sub-markets, with an achieved occupancy rate of 95.4%. The overall occupancy rate for the Jakarta retail market recorded an increase from 84.8% to 85.2% over the semester, translating to vacant retail space of 428,671 sq-m. The average occupancy for strata-title retail centres stood at 79.21%, with such centres contributing the largest part of the vacant retail space, at 71,3% of the total vacant space. Meanwhile, a number of foreign retailers have been reported to start their debut in Indonesia and have secured retail premises mainly in proposed projects in the, such as Kidzania in Pacific Place, and Harvey th Nichols in Grand Indonesia, both of which are expected to commence operation in 4 quarter of. Table 6 Jakarta Retail Market Highlights (1H - ) Retail Type Total Existing Supply Occupancy Rate Vacant Space - Rental Space 1,418,624 sq-m 91.32% 123,114 sq-m - Strata-title Space 1,469,83 sq-m 79.21% 35,557 sq-m Total 2,888,427 sq-m 85.16% 428,671 sq-m Rp63, Rp43, Rp23, Rp3, Premium Grade A Grade A Grade B Grade C Rents and Prices The average gross rental rate of prime ground floor was Rp658,969 /sq-m/month, a slight decline of.14% over the last semester. Likewise, in US Dollar terms, the average gross rental rate declined slightly by.51% from US$73.16 to US$72.78 /sq-m/month. Whilst Premium Grade-A and Grade A rents remained relatively unchanged, the average gross rental rate in Grade B and C sub-markets increased in both US Dollar and Rupiah terms. Table 7 Asking Base Rental Rates and Service Charges of Prime Ground Floor by Shopping Centre Grade (1H ) Figure 13 Asking Gross Rental Rates of d Shopping Centres in US$ by Grade (2H 23-1H ) $165 $145 $125 $15 $85 $65 $45 $25 $5 2H3 1H4 2H4 1H5 2H5 1H6 2H6 1H7 Premium Grade A Grade A Grade B Grade C Shopping Centre Changes from Base Rental /sq-m SC /sq-m Gross Rental /sq-m Grade 2H 26 Rupiah US$ Rupiah US$ Rupiah US$ Rupiah US$ Overall Rp. 588,533 $ 65. Rp. 7,436 $ 7.78 Rp. 658,969 $ 72.78 -.51% -.14% Premium Grade-A Rp.1,171,841 $129.43 Rp.111,727 $12.34 Rp.1,283,569 $141.77 -.29%.9% Grade-A Rp. 691,823 $ 76.41 Rp. 71,828 $ 7.93 Rp. 763,651 $ 84.34 -.27%.11% Grade-B Rp. 385,779 $ 42.61 Rp. 65,116 $ 7.19 Rp. 45,895 $ 49.8 4.92% 5.31% Grade-C Rp. 34,486 $ 33.63 Rp. 49,525 $ 5.47 Rp. 354,11 $ 39.1 9.34% 9.75% US$1 = Rp.9,54 Market Outlook In anticipating the large supply coming on stream by the end of this year, the overall occupancy is projected to decrease slightly despite high pre-commitment of the two major shopping centres for lease in. New foreign retailers will continue opening their outlets in prime centres. The increasingly competitive market for Prime Grade-A and Grade A segments has forced developers to upgrade their centres either by restructuring the tenancy mix or cosmetic renovation. Meanwhile, the average gross rental rate is expected to remain unchanged in. www.knightfrank.com
Knight Frank Jakarta Property Highlights - First Half 6 Half of the proposed supply in - will be completed nd during the 2 Half of Figure 14 Jakarta Condominium Market Supply and Demand (2H 24-1H ) 5, 45, 4, 35, 3, 25, 2, 15, 1, 5, 2H24 1H25 2H25 1H26 2H26 1H 98% 96% 94% 92% 9% 88% 86% 84% 82% 78% 76% Condominium Market Supply st During the 1 half of, new supply totaling 4,228 units was added from 8 projects, namely Mediterania Boulevard (88 units), Mediteranian Lagoon Residence (34 units), The Belezza Apartment (25 units), The Peak Sudirman (362 units), Salemba Residences (75 units), The Summit Kelapa Gading (386 units), The City Resort Residence (46 units) and Teluk Intan (8 units). Most of the new supply is located in non- areas, accounting for approximately 3,866 units or almost 91% of total. As of June, the cumulative supply of condominium units in Jakarta stood at 48,87 units, representing an increase of about 9.5% from 26's figure of 44,642 units. The existing condominium stock remained dominated by the middle segment with approximately 67%, followed by low-middle, upper and upper middle segments with 18%, 8% and 7%, respectively. Future supply in - is projected at 27,534 units, of which approximately 33.9% is located in the area. About 55.2% of the proposed supply or 15,26 units will be completed in the second semester of. Table 8 Future Condominium Supply (Year - ) Year Total Proposed Supply 15,26 units 7,32 units 5,8 units Total Proposed Supply 27,534 units Cumulative Supply Cumulative Demand Occupancy Rate Figure 15 Market Segmentation of Existing Condominium Supply Demand As of June, the sales rate of existing condominium projects stood at 95.67%, leaving 2,118 units unsold. This compared with the previous 6 months when the sales rate of the Jakarta condominium market was 96.53% with 1,55 units unsold. During the review period, increasing new supply resulted in slower condominium unit take-up of existing projects. Recent net take-up totaled 3,659 units, comprising 686 units sold in the existing projects and 2,973 units in the pre-sales market. Meanwhile, by December 26 it was recorded net take-up of 3,33 units, from 1,116 units sold in existing projects and 2,187 units in the pre-sales market. Overall, net take-up recorded positive growth of almost 11%. Upper 8% Upper Middle 7% Lower Middle 18% Table 9 Jakarta Condominium Market Highlights (1H - ) Total Existing Supply 44,87 units Sales Rate of Existing Supply 95.67% Existing Unsold Units 2,118 units Proposed Supply - 27,534 units Pre-sales Rate of Proposed Supply 77.28% Prices Middle 67% As of June, the average condominium price within and Prime non- areas was approximately Rp13.46 million per sq-m and Rp11.35 million per sq-m, respectively. Over the period, the average price in the area has increased by approximately 2.21%, whilst Prime non- areas enjoyed a slightly higher growth of 7.71%. With an increment increase of 1.22%, the average price of condominiums within secondary areas was relatively stable at Rp6.65 million per sq-m. Increasing new supply resulted in slower take-up in existing projects Table 1 Condominium Asking Sales Prices and Service Charges by Location (1H ) Changes from Asking Sales Price /sq-m Service Charge /sq-m Location 2H 26 Rupiah US$ Rupiah US$ Rupiah US$ Rp.13,459,19 $1,487 Rp.14,863 $1.64 2.21% 4.98% Prime Non- Rp.11,35,455 $1,254 Rp.12,173 $1.34 7.71% 1.65% Secondary Non- Rp. 6,647,294 $ 734 Rp. 7,33 $.81 1.22% 3.99% US$1 = Rp.9,54
7 Jakarta Property Highlights - First Half Knight Frank Figure 16 Market Segmentation of Proposed Condominium Supply Upper Middle 18.89% Low Middle 6.54% Market Outlook As an of affordable urban living alternative, middle segment condominiums will continue to dominate the market. Demand is projected to remain positive in line with the declining interest rate and inflation. Large supply to come on stream will increase the market competition, while the average price is expected to remain steady. Upper 18.33% Middle 56.24% Demand is expected to remain positive with relatively unchanged average price www.knightfrank.com
Knight Frank Jakarta Property Highlights - First Half 8 Increasing competition in the serviced apartment market Rental Apartment Market Supply The total rental apartment stock increased to 7,19 units, comprising 3,75 serviced and 3,269 nonserviced, purpose-built rental apartment units. New supply came from the completion of 113 serviced apartment units at The Peak Tower A (Beaufort Residence). Total proposed supply in - is recorded at 1,62 units, of which 91% are serviced apartments projects. The occupancy of both serviced and non-serviced rental apartment increased Figure 17 Jakarta Rental Apartment Occupancy Rates (2H 25-1H ) 89% 88% 87% 86% 85% 84% 83% 82% 81% 79% 78% 2H 25 1H 26 Serviced Apartments 2H 26 Non-ServicedApartments 1H Table 11 Future Rental Apartment Supply (Year -) Year Total Proposed Supply 585 units 477 units Total Proposed Supply 1,62 units Demand The occupancy of both serviced and non-serviced rental apartments increased in the first half of. Despite the increase in supply, serviced apartment occupancy rose to 85.7%. Meanwhile, non-serviced, purpose-built rental apartment occupancy increased slightly to 87.19%. Overall, rental apartment market occupancy increased to 86.5%. Table 12 Jakarta Rental Apartment Market Highlights (1H ) Market Segment Total Supply Occupancy Serviced Apartments 3,75 units 85.7% Non-Serviced, Purpose-Built Rental Apartments 3,269 units 87.19% Total Existing Supply 7,19 units 86.5% Rents Asking gross rents remained relatively stable in the serviced apartment market. Meanwhile, several nonserviced rental apartment developers increased their rents. As at June, average gross rental rates of non-serviced rental apartments increased to US$15.15 per sq-m per month in the and US$14.34 per sq-m per month in prime non- areas. Serviced apartment occupancy is likely to decline Condominium units remain a major competition to non-serviced rental apartments Table 13 Asking Gross Rental Rates of Jakarta Rental Apartment Market (1H ) Market Segment Asking Gross Rental/month Change from 2H 26 Serviced Apartments - - Prime Non-Serviced, Purposed-Built Rental Apartments Rupiah/sq-m Rp.21,329 Rp.151,911 US$ $23.23 $16.78 Rupiah -.54% 1.21% US$ -.91%.83% - - Prime Rp.137,196 Rp.129,814 $15.15 $14.34 2.14% 5.67% 1.76% 5.27% US$1 = Rp.9,54 Market Outlook The overall occupancy in the serviced apartment market is likely to decline in the short term, due to the increasing number of new supply, not only in the established and prime non- locations, but also in secondary areas outside the. Nevertheless, there remains good demand for serviced apartments in good locations with good operators. Individual condominium units entering the rental market will remain a significant competition to the nonserviced, purpose-built rental apartments.
9 Jakarta Property Highlights - First Half Knight Frank Rooms reduction/hotel closure combined with st no new supply in the1 half of, decreased the total existing stock Figure 18 Market Segmentation of Existing Jakarta Hotel Supply 5 Star Hotels 41% 3 Star Hotels 29% Hotel Market Supply st A similar trend to the final semester of 26 continued in the 1 semester of, with a number of hotels reducing their room supply. Early in the year, over 5% of rooms in The Sultan Hotel were temporarily closed, leaving approximately 55 rooms available. There is no definite plan as to the size and type of development for the above premises, as the management is still considering few options available. Hotel Raddin Ancol was closed down in May. With no new hotels opening during the review period, the total supply for 3, 4 and 5-star hotels in Jakarta declined by 3.7% to 21,2 rooms from 92 hotels. Based on the number of hotel rooms, 5-star hotels contributed the largest share of supply at 41%. Based on the number of hotels, 3-star hotels were the largest contributor to supply at 5%. Approximately 34.1% of the existing supply was located in the. Jakarta hotel market will see no new hotels completed during. New supply is projected to enter the market in -21, totaling 2,422 rooms from 11 hotels. The 5-star hotels will contribute almost 6% or 1,344 rooms. By, the Jakarta hotel market will see a larger involvement of Aston in managing new hotels and serviced apartments in Jakarta, including Grand Aston Albergo di Bellezza (Permata Hijau, South Jakarta), Aston Marina Ancol, Hotel & Residence (Ancol, North Jakarta), Aston SoHo, Hotel & Residence (Slipi, West Jakarta) and Aston Mangga Dua, Hotel & Residence, (Mangga Dua, North Jakarta). Meanwhile Accor, as the major hotel operator in Jakarta, will manage 2 new hotels by, adding to the 9 existing hotels managed by Accor. 4 Star Hotels 3% Figure 19 Passenger Arrivals at Soekarno-Hatta Int l Airport (21-1H) 12,, 1,, 8,, 6,, Table 14 Future Hotel Supply Completion Schedule (Year - ) Year Project Name Star Rating No. of Room Location Ritz Carlton at S Ibis Patria Park Aston Mangga Dua Kempinski at Grand Indonesia Grand Aston Albergo di Bellezza Akmani Hotel Harris - Kelapa Gading Pembangunan III Kota Kasablanka Gandaria Main Street Novotel Sophie Martin Boutique 3* 4* 5* 5* 3* 4* 4* 5* 5* 4* 62 16 148 27 2 118 31 42 512 3 3 Total 2,422 4,, 2,,! " # $ International Domestic Source: PT (Persero) Angkasa Pura II Figure 2 Occupancy Rate by Star Rating (2H24-1H) 7% 6% 5% 4% % Demand During the first semester of, total passenger arrivals at Soekarno-Hatta International Airport were recorded at 7,17,879 people, slightly increased by 1.12% from the level achieved at the same period last year. International arrivals grew by 3.1%, whilst domestic arrivals plunged by 9.7%. The overall occupancy rate continued to improve over the review period, from 62.21% during the last semester of 26 to 64.53%. All hotel categories enjoyed occupancy rate increment, led by 3 and 4 star hotels at 7.48% and 68.76%, respectively. Occupancy for 5 star hotels slightly increased to 57.29%. Table 15 Jakarta Hotel Market Highlights (1H ) Existing Supply Overall existing supply and demand 21,2 rooms Occupancy 64.53 % 3% 2% 1% % 2H 24 1H 25 2H 25 1H 26 2H 26 1H 3-star 4-star 5-star Distribution by Star-Rating - 3-star hotels - 4-star hotels - 5-star hotels 6,71 rooms 6,42 rooms 8,727 rooms 7.48% 68.76% 57.29% Distribution by Location - area - Non- area 7,227 rooms 13,973 rooms 34.9% 65.91% www.knightfrank.com
Knight Frank Jakarta Property Highlights - First Half 1 Both Average Room Rates and occupancy improved in all submarkets Average Room Rates (ARR) In line with improved occupancy rates, average room rates in USD terms grew by approximately 2% in all sub markets. ARR reached US$32.1, US$46.78 and US$77.15 per night for 3-star, 4-star and 5-star hotels, respectively. Table 16 ARR of Jakarta Hotel Market by Star Rating (1H ) Figure 21 ARR by Star Rating (2H24-1H) $8 $7 $6 $5 $4 $3 $2 $1 $ 2H 24 1H 25 2H 25 1H 26 2H 26 1H 3-star 4-star 5-star Figure 22 RevPar by Star Rating (2H24-1H) $45 $4 $35 $3 $25 $2 $15 $1 $5 Change from ARR Market Segment 2H 26 Rupiah US$ Rupiah US$ 3-Star Hotels Rp.289,799 $32.1 2.12% 1.74% 4-Star Hotels Rp.423,531 $46.78 2.45% 2.7% 5-Star Hotels Rp.698,529 $77.15 2.13% 1.75% US$1 = Rp. 9,54 Revenue per Available Room (RevPar) Due to the improvement in both occupancy and ARR, RevPar for 3 and 4-star hotels enjoyed an increase of 2-2.5% to US$21.23 and US$32.82 per night, respectively. With higher increase of 3.26%, RevPar for 5-star hotels reached US$46.6 per night. Table 17 RevPAR of Jakarta Hotel Market by Star Rating (1H ) Change from RevPAR Market Segment 2H 26 Rupiah US$ Rupiah US$ 3-Star Hotels Rp.192,238 $21.23 2.5% 2.11% 4-Star Hotels Rp.297,179 $32.82 2.92% 2.53% 5-Star Hotels Rp.417,67 $46.6 3.65% 3.26% US$1 = Rp. 9,54 Market Outlook The overall occupancy and average room rates are likely to remain stable by the end of this year, taking into account the positive outlook of most of the Indonesian macroeconomic indicators, the reduction of existing room supply and the fact that there is no new supply expected to be completed in. $ 2H 24 1H 25 2H 25 1H 26 2H 26 1H 3-star 4-star 5-star The overall occupancy and ARR is anticipated to remain stable in
Research Indonesia Contact Willson Kalip President Director willson.kalip@id.knightfrank.com Research & Consultancy Fakky Ismail Hidayat Senior Associate Director fakky.hidayat@ id.knightfrank.com Knight Frank Research provides strategic advice, consultancy services and forecasting to a wide range of clients worldwide including developers, investors, funding organizations, corporate institutions and the public sector. All our clients recognize the need for expert independent advice customized to their specific needs Knight Frank Research Reports are also available at www.knightfrank.com Valuation Bayu Wiseso Associate Director bayu.wiseso@id.knightfrank.com Commercial Leasing Sindiani Surya Adinata Director sindiani.adinata@id.knightfrank.com Americas USA Bermuda Brazil Caribbean Australasia Australia New Zealand Europe UK Belgium Czech Republic France Germany Hungary Ireland Italy Poland Portugal Russia Spain The Netherlands Ukraine Africa Botswana Kenya Malawi Nigeria South Africa Tanzania Uganda Zambia Zimbabwe Asia China Hong Kong India Indonesia Macau Malaysia Singapore Thailand Knight Frank / PT. Willson Properti Advisindo This report is published for general information only. Although high standards have been used in the preparation of the information, analysis, views and projections presented in this report, no legal responsibility can be accepted by Knight Frank Research or Knight Frank / PT. Willson Properti Advisindo for any loss or damage resultant from the contents of this document. As a general report, this material does not necessarily represent the view of Knight Frank / PT. Willson Properti Advisindo in relation to particular properties or projects. Reproduction of this report in whole or in part is allowed with proper reference to Knight Frank Research. Technical Note The figures in this report relate to the availability of built, up-and-ready office, shopping centres and apartments within Jakarta market. Vacant premises and leased spaces which are being actively marketed are included. +62 (21) 57 717 www.knightfrank.com