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ndonesian developers will benefit from the solid demand for residential, office and retail space in Greater Jakarta over the next 12-18 months, says Moody'€™s Investors Service in its latest report on the property market.

Developers will also see stable to high rental occupancy rates in their office and retail portfolios, as well as higher rental returns from these two commercial segments. Moody'€™s defines Greater Jakarta as the area including Jakarta, Depok, Bogor, Tangerang and Bekasi.

'€œWe expect strong residential sales as a result of the growing population, urbanization and falling unemployment rate,'€ Jacintha Poh, a Moody'€™s analyst, said.

'€œThe take-up rate on completed residential properties should be above 90 percent in 2013 judging by the healthy presale levels achieved by our rated developers at the end of 2012,'€ Poh said.

Poh was speaking on Moody'€™s just-released report, '€œSustained Demand for Greater Jakarta Property Supports Indonesian Developers'€.

In the report, Moody'€™s rates three property developers: Lippo Karawaci (Ba3 stable), Alam Sutera Realty (B1 stable) and Pakuwon Jati (B2 stable).

According to the report, both supply and demand in the residential market in Greater Jakarta have been growing steadily despite the global financial crisis in 2008-2009.

The report also says that residential price growths have been backed by real demand and a proportionate growth in household incomes. Average residential prices (per square meter) have increased at a compound annual growth rate (CAGR) of 15.6 percent over the last three years and remained broadly in line with the CAGR of per capita income of 16.4 percent during the same period.

'€œThe office segment will see high occupancies and rising rental rates as there is limited new supply. Demand in the sector is being fuelled by new corporate set-ups and expansions,'€ Poh said.

Moody'€™s quotes property consulting firm Colliers International Indonesia (Colliers) as saying that office occupancy rates will reach 95-98 percent in 2013, providing a favorable backdrop for rental rates to grow by 7-16 percent this year.

'€œWe expect strata-titled office space sales to be strong, as the cost of renting is almost equivalent to monthly mortgage payments,'€ Poh said.

In the retail segment, Moody'€™s further quotes Colliers as saying that occupancies will be broadly stable, between 87 and 98 percent while rental rates will improve up 10 percent, with supply growing in accordance with the expected demand increase.

The report adds that retail space demand will remain supported by buoyant domestic consumption and an influx of foreign retailers.

'€œWhile the retail segment is expected to be competitive, we expect strong retail space demand in middle- to upper-class malls located within large-scale developments or townships, as these malls cater to residents in captive areas,'€ Poh said.