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Not back to normal for commercial real estate post-PPKM: Property firms
While most industries may have recovered to their pre-pandemic levels, commercial real estate could use a boost through government stimulus in light of lagging occupancy rates and global recession fears, industry insiders have said.
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Gandaria City, a mixed-use complex that includes an upscale shopping mall located in Kebayoran Lama, South Jakarta, is one of the properties managed by developer PT Pakuwon Jati. (Kontak/Baihaki)
T
he government’s revocation of the remaining public activity restrictions (PPKM) earlier this month should be complemented by more fiscal and monetary stimulus packages to reinvigorate retail and business activities, private sector firms have demanded.
Businesses expected “normality” to return to shopping centers, which would in turn bolster confidence in the economy, but progress would “not be easy” because consumer habits had changed, Real Estate Indonesia (REI) chairman Paulus Totok Lusida told The Jakarta Post.
The government fully lifted the PPKM in early January in the hope of recovering economic growth potential that had dissipated during the COVID-19 pandemic.
The construction sector has not yet returned to pre-pandemic levels, but all other sectors of the economy had recovered, according to the Finance Ministry.
“Shopping centers shifted their priorities during the PPKM era to promote [dining] and attractions,” Paulus said on Wednesday.
He said the shift in strategy came in response to widespread change in consumer behavior during the pandemic, when visitors spent minimal time in malls, which had complicated retailers’ efforts to drive sales.
Paulus attributed the absence of visitors who used to fill Jakarta malls to tenants’ failure to cater to new social trends, particularly by using the internet to promote their goods and services.
