Quarterly | Apartment | Jakarta | 5 April 2023

The market is expected to exhibit a tepid

state

Insights & recommendations

There was no significant upsurge in the demand for apartments in Q1 2023. Our analysis suggests that the
market is currently being driven primarily by end-users as opposed to investors. In the face of mounting
competition, developers are expected to focus on showcasing their ongoing projects and deploying
effective sales strategies.
As we approach 2023, some significant industry players, namely developers, have expressed a prudent
outlook by providing guidance for flat-to-slight sales growth targets. The prudent stance is indicative of the
potential headwinds that lie ahead this year, as the apartment market prepares to withstand the impact of
rising interest rates. Additionally, the market is expected to feel the impact of the 2024 presidential election
during the second half of the year. Historically, developers have slowed the pace of new launches ahead of
elections, in anticipation of decreased demand for property purchases.

2023–2025
Q1 2023 Full Year 2023 Annual Avg.

There has been a slight improvement in sales

performance as compared to the previous quarter. 0.4%
Demand However, it is plausible that the market could
encounter a slow absorption in the upcoming year 87.7% 87-88% 87-89%
due to political uncertainty.

Six projects were completed in Q1, resulting to

3,374 additional units. Moreover, it is anticipated
3,374 units 6,172 units 5,003 units
Supply that 2,798 more units will be delivered by the end
of 2023.

Annual Avg Growth

QOQ/ YOY/ 2023–2025/
End Q1 End 2023 End 2025

0.22% 1% 3%
There was a marginal increase when compared to
the previous quarter. It is anticipated that the
Price
price will witness a growth of 2-3% over the next IDR35.44mio IDR35.75mio IDR38mio
few years, consequent to the development of the
city's infrastructure.

Source: Colliers. Note: IDR15,242 = 1 USD.

1
Strata-title apartments Indomaret Project. As of now, the total supply of
strata-title apartments is recorded at 223,825 units,
Prominent developers continue to exercise exhibiting a QOQ increase of 1.5% and a YOY increase
of 2%. The total existing supply remains dominated by
prudence in initiating new projects
West Jakarta (28%), followed by South Jakarta (22.4%),
Cumulative supply and North Jakarta (21.9%).

250,000
Our research has uncovered a total of 15 projects that
were originally scheduled to be handed over between
200,000 2020 and 2022 but experienced delays. However, in
the current quarter, six of these projects have been
150,000 completed and handed over, resulting in 3,374
additional units to the overall supply. This represents
100,000
54.7% of the projected supply for 2023. Furthermore,
based on our analysis of the progress of ongoing
50,000
projects, we anticipate that 11,635 more units will be
0 completed from the subsequent quarter until 2025.
This includes 2,798 units in 2023, 6,247 units in 2024,
2023E

2024E

2025E
2018

2019

2020

2021

2022

and 2,590 units in 2025.

Existing supply Annual supply
Source: Colliers
In Q1 2023, two new projects were introduced,
namely Adriya and Apple 7 Condovilla situated in
Pantai Indah Kapuk (PIK) and Pancoran areas,
respectively, comprising a total of 1,016 units. Adriya
features 3-bedroom units, targeted towards second
generation residents from the surrounding residential
area. Our field observations indicate that the project
has performed exceedingly well, as it has successfully
attracted its intended market of end-users with
significant buying power since its launch in 2021.
Furthermore, we perceived PIK as a prospective CBD
area, as it continues to undergo rapid and continuous
development. This is exemplified by the ongoing
massive development at PIK 2 (an extension of PIK),
which includes various upscale projects, such as the
Islamic Financial Center, BCA Tower, BNI Tower, and
In general, many key industry players began Q1 with a
cautious outlook. Having missed their targets last
year, they opted for a conservative approach and set
their 2023 sales targets relatively the same as that in
2022. This was evidenced by the limited number of
projects launched this quarter. However, we observed
that several projects have adopted a new sales
strategy. In the past, developers would typically
provide a pre-sales (early bird) offer before starting
construction, but in the current buyer’s market
situations, they are now more inclined to complete
construction first before launching their products. We
believe that buyers have become more discerning and
cautious, seeking to avoid any risks associated with
uncompleted projects.

2
Several Developers' Sales Target and Realization Take-up Rate Apartment Jakarta

Target 2021 Realization 2021 Target 2022

Existing Under construction
Realization 2022 Target 2023
10 100%

8
Sales (IDR tn)

80%
6
60%
4
2 40%
0
20%

0%
Q1 2018 Q1 2019 Q1 2020 Q1 2021 Q1 2022 Q1 2023
Source: Colliers
Source: Colliers

Probable market deceleration anticipated
in the upcoming quarter
In light of the low number of new projects launched
in the quarter, developers have directed their
attention towards clearing the unsold units of their
ongoing projects. This has led to a modest increase in
the average absorption rate, which now stands at
87.7%, representing a QOQ increase of 0.4% and a
YOY increase of 0.1%. In total, out of 486 units sold in
Q1, about 55% were from existing projects.
Moving ahead, the market may encounter
impediments due to political ambiguity. With
Indonesia approaching an election year, potential
buyers, especially investors, may adopt a more
apprehensive stance, leading to a possible
deceleration in the market. This may result to a
reduction in the take-up rates, as buyers and
investors may refrain from making significant
property acquisitions until the political situation
becomes more secure.

Annual apartment unit absorption The lack of movement in prices persists

well into the early stage of 2023
10,000
In Q1 2023, there was a marginal uptick of 0.22% QOQ
8,000 and 0.85% YOY in the market’s average price per sq m,
primarily propelled by multiple factors, such as the
6,000
Units

ongoing construction and imminent completion of

various projects. However, despite the recent launch
4,000 of several projects, the majority did not surpass the
average market price. As a result, the average price
2,000
per sq m continues to hover around IDR 35.4 million.
0
Asking prices across regions
2016

2017

2018

2019

2020

2021

2022

2023YTD

Q1 2022 Q4 2022 Q1 2023 QOQ YOY

CBD 52,423,324 52,701,064 52,762,800 0.12% 0.65%

Source: Colliers
South
39,543,742 39,847,210 39,984,287 0.34% 1.11%
Jakarta
Non-
prime 26,776,667 26,936,580 26,988,073 0.19% 0.79%
areas
Overall
35,143,935 35,365,940 35,442,839 0.22% 0.85%
Jakarta

Source: Colliers

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Developers have become increasingly innovative in
their approach to attract potential buyers. In an effort
to make their products more alluring, they are now
offering various deals and marketing strategies,
including electronic vouchers, free-furnished
vouchers, and up to two years of free maintenance
fees. These strategies not only benefit the buyers, but
also help developers clear their inventory more
quickly in a highly competitive market.
Looking ahead, we anticipate a gradual increase in
prices due to ongoing infrastructure developments in
the city. This includes the construction of MRT Phase
II and III, which will cover West Jakarta, Central Jakarta,
and East Jakarta. Our projections indicate that the
average price is expected to rise by 2-3% between
2023 and 2025.
Serviced apartments
Supply
In Q1 2023, a new serviced apartment project, named
Ashta Residence Jakarta, was completed. This project
offers 137 serviced apartment units, ranging from
studio to three-bedroom units. As a result, the total
supply of Jakarta’s serviced apartment stock has
increased to 6,708 units. However, we anticipate the
pipeline to continue to grow at an 8% CAGR until
2025, with the total supply reaching 7,818 units. It is
worth noting that most of the expected supply will be
in the CBD area, which is a concentrated area of
business in Jakarta
Occupancy and rental rate
Typically, Q1 sees a slowdown in rental market,
particularly in January and February due to the New
Year and Chinese New Year holidays. Occupancy level
in Q1 2023 declined due to the addition of newly
completed serviced apartment projects that outpaced
the growth of occupied units. Apart from seasonal
effects, this has resulted in a drop in the overall
occupancy level, falling from 61.2% in the previous
quarter to 58.5%.
Meanwhile, rental rate in the CBD area has increased
due to rising operational costs and optimistic market
sentiment for 2023. In contrast, rental rates in the
South Jakarta area (including non-prime areas) are
mixed, with international chain operators mostly
increasing rental rates to follow regional policies,
whilst local operators tend to keep rental rate
unchanged to attract potential tenants. Consequently,
the average rental rate in the CBD area rose by 10.6%
QOQ to IDR444,943/sq m/month, whilst South Jakarta
(including non-prime areas) increased by a modest
0.3% QOQ to IDR369,911/sq m/month.
Looking forward, assuming the pandemic is now
under control, there should be continued demand for
serviced apartments among corporate travellers.
Even though the landscape of business travel leasing
has shifted from senior executives with family to
younger single expatriates from Asian countries,
serviced apartments are still a preferred leasing
option due to their compact units, affordable tariffs
(compared to single homes in expat areas), flexible
leasing terms, and 24-hour services. The newer
serviced apartment developments tend to have
smaller units, with more studio-type units being
offered.
However, there are concerns about a global economic
slowdown, leading to higher unemployment, wage
stagnation, and low inflation. Nonetheless, the
Indonesian serviced apartment market is closely tied
to foreign direct investment and the arrivals of expats
hired by international companies. Whilst the influx of
foreign professionals may not be as strong as that in
2022, there should still be positive market growth..
4
Occupancy rate Rental rate

100% CBD South Jakarta (incl. Non-prime area)

IDR500,000
80%
IDR450,000
60%
IDR400,000
40% IDR350,000

20% IDR300,000

IDR250,000
0%

2019

2020

2021

2022

2023YTD
Q1 2021

Q2 2021

Q3 2021

Q4 2021

Q1 2022

Q2 2022

Q3 2022

Q4 2022

Q1 2023

Source: Colliers Source: Colliers

Appendix
Newly introduced project

Expected
Apartment Name Location Region Developer #Units
Completion Time
Jl. Pantai Indah
Adriya (North Tower) Kapuk North Jakarta ADR Group 2025 108
Boulevard
Jl. Pantai Indah
Adriya (South Tower) Kapuk North Jakarta ADR Group 2025 108
Boulevard
Jl. Raya Pasar Diamond Land
Apple 7 Condovilla South Jakarta 2027 800
Minggu Development
Source: Colliers

Newly finished project

Apartment Name Location Region Developer #Units

Menara Jakarta (Equinox

Kemayoran Central Jakarta Agung Sedayu Group 396
Tower)
Menara Jakarta (Azure
Kemayoran Central Jakarta Agung Sedayu Group 860
Tower)
The Residences at The St.
Jl. H.R. Rasuna Said CBD Rajawali Property Group 164
Regis Jakarta
Sakura Garden City (Tower
Jl. Bina Marga East Jakarta PT Trivo Group and Daiwa House 648
Cattleya)

Arumaya Residence TB Simatupang South Jakarta Astra Land 262

Southgate Residence
Jl. Tanjung Barat Raya South Jakarta Sinar Mas Land 450
(Altuera Tower)

JKT Living Star (Tower A) Jl. Lapangan Tembak East Jakarta PT Sindeli Propertindo 594

Source: Colliers

5
Under construction project

Apartment Name Location Region Developer #Units

2023

PT Itomas Kembangan Perdana

Aerium Taman Permata Taman Permata
West Jakarta (Sinarmas Land & ITOCHU 366
Buana (South Tower) Buana
Indonesia)

Le' Parc (The Mansion) Jl. Thamrin CBD PT. Putragaya Wahana 30

Le' Parc (The Townhomes) Jl. Thamrin CBD PT. Putragaya Wahana 25

Le' Parc (The Terraces) Jl. Thamrin CBD PT. Putragaya Wahana 51

Fatmawati City Center

Fatmawati South Jakarta Agung Sedayu 640
(Corona Tower)

Fatmawati City Center

Fatmawati South Jakarta Agung Sedayu 704
(Victoria Tower)

Cleon Park Apartment Cakung, Jakarta

East Jakarta Modern Land Realty 310
(North Tower) Garden City

South Quarter Residence

TB Simatupang South Jakarta Intiland 336
(Tower D)

South Quarter Residence

TB Simatupang South Jakarta Intiland 336
(Tower E)

2024

Antasari Place (was 45

Antasari South Jakarta Prospek Duta Sukses 980
Antasari) (Tower 1)

Asthana Kemang (Sadewa Jl. Ampera Raya

South Jakarta PT. Synthesis Development 362
Tower) No.17

Jl. Dharmawangsa
Moon Apartment South Jakarta PT Dharma Tatemono Property 72
VII

Solterra Place (Tower

Pejaten South Jakarta Waskita Realty 521
Suites)

Jl. Sinabung Raya

The Padmayana South Jakarta Adhi Karya 145
No.58

Branz Mega Kuningan Mega Kuningan CBD Tokyuland 482

The Premiere MT Haryono -

Jl. MT Haryono East Jakarta Adhi Karya 390
LRT City MT Haryono

continued

6
 Apartment Name Location Region Developer #Units

continuation

LRT City Ciracas - Urban Jl. Pengantin Ali,

East Jakarta Adhi Karya 1087
Signature (Azure Tower) Ciracas

The Newton 2 at Ciputra

Jl. Karet Sawah CBD Ciputra 624
World 2

Jakarta Setiabudi International &

Savyavasa (3 Towers) Jl. Wijaya II South Jakarta 431
Swire Properties

B Residence Grogol Jl. Daan Mogot 79 West Jakarta MGM Propertindo 252

Jl. Karang Indah,

Apple Residence 3 South Jakarta PT Diamond Land Development 530
Lebak Bulus

Vittoria Residence (Tower

Jl. Daan Mogot West Jakarta PT. Duta Indah Kencana 312
Citrine)

Arumaya Garden Villa TB Simatupang South Jakarta Astra Land 59

2025

Kebayoran Apartment (was

Jl. Raya Ulujami South Jakarta Karya Cipta Group 344
Selatan 8) (Diamond Tower)

Antasari Place (was 45

Antasari South Jakarta Prospek Duta Sukses 621
Antasari) (Tower 2)
Asthana Kemang (was
Jl. Ampera Raya
Synthesis Residence South Jakarta PT. Synthesis Development 362
No.17
Kemang) (Nakula Tower)
The Veranda @ Lebak Bulus
Lebak Bulus South Jakarta Pulau Intan & Nishitetsu 178
(Jimbaran Tower)

The Veranda @ Lebak Bulus

Lebak Bulus South Jakarta Pulau Intan & Nishitetsu 192
(Ubud Tower)

Sakura Garden City (Dahlia Jl. Bina Marga

East Jakarta PT Trivo Group and Daiwa House 648
Tower) No.88

Mitsubishi Estate Group, Duta Putra

The Okura Residences Jl. Gatot Subroto CBD 29
Land, Rizki Bukit Abadi

Jl. Pantai Indah

Adriya (North Tower) North Jakarta ADR Group 108
Kapuk Boulevard

Jl. Pantai Indah

Adriya (South Tower) North Jakarta ADR Group 108
Kapuk Boulevard

Source: Colliers

7
 For further information, please contact:
Ferry Salanto Hern Rizal Gobi
Senior Associate Director | Senior Manager | Research |
Research | Jakarta Jakarta
62(21) 3043 6730 62(21) 3043 6727
Ferry.Salanto@colliers.com Rizal.Gobi@colliers.com

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