Demand stems from diverse local and international industries, with 3PLs continuing as the primary driver

• In H2 2024, net absorption surpassed 95,000 sqm due to new completions. Cost remained a key factor for tenants, particularly 3PLs. New warehouses offered improved specs, while existing projects upgraded facilities to attract tenants.
• 3PLs remained dominant, but demand from various industries grew. Furniture, appliances, IT, machinery, automotive and e-commerce tenants leased 5,000–20,000 sqm spaces. Inquiries for large, flexible facilities rose, though availability was limited.

New supply emerges across submarkets

• Seven new buildings added 171,000+ sqm to the market.
• Double-digit vacancy rates persisted due to a continuous new supply influx. The 2024 total new space addition of around 230,000 sqm was modest compared to previous years. This slower pace is expected to continue as developers and investors assess the market.

Modest rent growth persists as investor interest remains healthy, driving market dynamics

• The logistics sector remained attractive to new investors. These newcomers showed interest in strategic partnerships, such as forming joint ventures and expanding existing portfolios, contributing to the sector’s ongoing development.
• Modest rent increases continued, especially for accessible, high-quality projects. Warehouses in areas with limited supply commanded premium prices. Developers offered superior specs to attract tenants from traditional facilities.

Outlook: Logistics sector to expand horizons, tapping into new locations

• Greater Jakarta anticipates steady new supply in the coming years, including in untapped locations. An estimated 0.8 million sqm of new inventory is expected across all subdistricts by 2027. This addition may maintain double-digit vacancy rates at around 12-13%.
• Demand is anticipated to diversify, with various domestic and international industries showing interest. This evolving landscape, linked to Indonesia’s manufacturing and overall economic growth, is likely to reshape market dynamics in the coming months.