APPD Market Report Article


December 1, 2021


IDR 6,386,898


Net absorption remains low

  • New tenants opened their stores as soon as malls reopened. This move was driven mainly by F&B tenants, including % Arabica, which opened its third store in Jakarta; and Index Living Mall, Thailand’s largest retailer of household furniture and appliances, which opened its first two stores in Jakarta, one each in Kota Kasablanka and Plaza Senayan. However, there were still some store closures.
  • Since mid-August, malls have been allowed to reopen and operate at 50% capacity, with specific age requirements and only for fully vaccinated people. Dining-in at restaurants was permitted at 50% capacity with 60 minutes to eat. Gyms and most entertainment tenants were still closed, while cinemas were permitted to reopen with 50% capacity, but no F&B was allowed inside.

No new prime mall completions

  • There were no new completions in 3Q21. Two shopping malls are expected to complete this year: Senayan Park and AEON Mall Southgate, with a total size of around 70,000 sqm.
  • Vacancy rates are still in single digits in Jakarta’s prime malls. The limited supply should take some of the pressure off existing malls during this time. Small to medium-size vacant spaces started to fill up while landlords continued to review their tenant mixes and increase their F&B portions.

Rents remain relatively stable

  • Rents in Jakarta’s Prime malls remained stable in 3Q21. Prime mall rents are expected to stabilise through end-2021 and likely to improve going forward, driven by limited supply in the upcoming years.
  • A few landlords started to move their rental rates back to normal, while others still provided tenants with relief on a case-by-case basis. In addition, the government has imposed a VAT (Value Added Tax) exemption, from August to October 2021, on space or building rentals for retailers who have standalone shops or outlets in malls.

Outlook: New completions expected to drive demand

  • Two Prime retail completions are expected for the remainder of 2021, which will drive demand − especially by F&B tenants as the main occupiers seeking expansion space. However, vacancy is likely to rise due to the new supply.
  • Due to Jakarta’s unofficial moratorium, the most likely point of entry is retail portions of mixed-use developments. Meanwhile, standalone mall developments are more likely to occur in the emerging Greater Jakarta area.

Note: Jakarta Retail refers to Jakarta's overall prime retail market.

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