Relocation and downsizing continue to trend

• A negative net demand of around 455 sqm was recorded in Q3 2024 due to downsizings and relocations. One company in the e-commerce sector made the highest contribution to positive demand, partially relocating from an older Grade A building in the same corridor.
• In Q3 2024, the e-commerce sector accounted for the largest portion in terms of size, followed by the oil & gas and technology sectors. Meanwhile, we have not seen any new deals or activities in the flexible space sector in Grade A buildings.

No further developments are projected for the rest of this year

• There will be no changes in supply in Q3 2024. Luminary Tower was the last Grade A supply addition in early 2024. This is similar to last year’s conditions, when Jakarta Mori Tower was the only building completed in 2023.
• The occupancy rate remained relatively stable at around 64% compared to the previous quarter, with total Grade A supply at around 3.7 million sqm.

Rents show a slight positive improvement

• Grade A net rents improved by approximately 0.7% q-o-q, but still decreased by 3.96% y-o-y.
• Several landlords with high occupancy levels started increasing their rents slightly. Meanwhile, some newly completed buildings with low occupancy still offered competitive rents to boost their occupancy rates.

Outlook: Limited supply expected for the remainder of 2024 and 2025

• No new supply is expected for the next 12 months. The vacancy rate is projected to decrease slightly to around 34% based on current expected net demand by end-2025.
• Rents are expected to gradually improve. Meanwhile, cost-savings will remain one of the main considerations from a tenant’s perspective, as well as downsizing and flight-to-quality.