APPD Market Report Article


February 28, 2023

Yunus Karim, Head of Research, Indonesia


IDR 3,067,119


Subdued condominium demand during the holiday season

  • Condominium sales activity remained subdued in 4Q22 since buyers typically tend to postpone transactions during the holiday season. Although demand was still weak, total annual sales were slightly higher compared to 2021 due to the government easing social restrictions, such that more onsite customer gatherings and events could be organised.
  • Demand for serviced apartments led to a slightly lower vacancy rate compared to the previous quarter. After the government opened the international borders, the number of foreigners from embassies and MNCs have started to slowly increase and repopulate vacant units. Locals also contributed to demand by seeking short-term leases as the holidays approached.

Limited new project launches and completions in 2022

  • Only one new condominium completed in the quarter, The St Regis Residences, closely following the opening of The St Regis Hotel. This is one of the most anticipated luxury brand condominiums in South Jakarta. In 2022, there were only two new projects launched into the market in the first quarter of 2022, the Okura Residence and Savyavasa.
  • No new serviced apartments were completed in the quarter. Citadines Sudirman was the only serviced apartment completed in 2022 and that was in the second quarter. There is only one new project set to complete sometime in 2023 — PARKROYAL Serviced Suites, a serviced apartment component of the Thamrin Nine Complex consisting of 180 units.

Stable serviced apartment rents during 4Q22

  • Condominium prices have remained flat. Local buyers, who are predominantly individual investors targeting attractive capital gains and recurring income, continue to take a wait-and-see approach. From the developer’s side, offering discounts and promotions was the main strategy to entice buyers.
  • In general, serviced apartment rents were flat as most landlords preferred to maintain stable rents due to relatively limited demand and strong competition with more recent completions, such as Citadines Sudirman, as well as with upcoming supply.

Outlook: More supply to enter the market

  • Following the government’s removal of social restrictions, a few condominium projects are expected to be introduced into the market sometime in 2023, after being postponed due to permit issues or from developers waiting for a more suitable time to launch. Demand will likely remain limited in the future but is expected to be better than 2022.
  • Considering that the travel ban has been lifted and the economy has begun to reopen, more businesses are expected to resume full operations. In addition, the rising number of expatriates should also help to fill vacant space.

Note: Jakarta Residential refers to Jakarta's luxury condominium and serviced apartment markets.

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