Jakarta's office vacancy rate leads to big cut in office costs

WITH the first half of 1993 seeing the completion of 1.6 million square feet of new office space, Jakarta's office vacancy rate has been boosted to about 13.5 per cent - and greater Jakarta has seen office rents dropping by 14 per cent on 1992 levels to an average of HK$8.7 per sq ft, according to a soon to be released report.

Colliers Jardine's Asia Pacific Trends research report predicts a vacant office space total of three million sq ft by the end of 1993. In the light of these developments, some landlords have offered to give four to six months rent free - compared to three months rent free in 1992 - for tenants taking space over 5,380 sq ft or for tenants taking space for longer than three years.

''Investment activity in Indonesia is constrained by the limited availability of finance,'' said Roger Cook, the chief executive officer of Colliers Jardine.

''However, there is a significant amount of activity in the sales of strata-titled offices, with four prime office buildings in the ''Golden Triangle'' area (bounded by Jalan Jenderal Sudirman, Jalan Gatot Subroto and Jalan Resuna Said) asking prices inthe range of HK$1,305 to HK$2,030 per sq ft and 70 per cent of units in the strata-titled Century Office Tower currently pre-sold.

''In the industrial property sector, a slowdown in the pace of new investment is evident in many industrial estates in and around Jakarta, with land prices reported in the range of approximately HK$20 to HK$72 per sq ft. The Jababeka estate attracted commitment from a chemical company in the first quarter of 1993.'' However, with the rapid growth of suburban populations - and increasingly disposable incomes - the report notes the developing trend of retailers seeking new outlets in suburban locations.

Retail space in Jakarta's suburbs has risen from 764,250 sq ft in 1987 to 3.3 million sq ft in June - with 1.06 million sq ft built this year.