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Office occupancy rate in Jakarta dips as more supply is available, JLL says
The demand has increased as companies are back in office after the pandemic, but they prefer smaller spaces to cut costs.
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Creative environment: Millennials share ideas at the Greenhouse Coworking Space in Multivision Tower, South Jakarta. The coworking space has been designed to stimulate a creative work environment. (The Jakarta Post/Dhoni Setiawan)
T
he average occupancy rate of Jakarta office space continued to be suppressed in Q1 this year following completion of several office projects that brought up the supply, according to property consultancy Jones Lang LaSalle (JLL).
JLL said at a virtual press briefing on Wednesday that the occupancy rate of office space in the CBD and non-CBD areas both dipped by a 1 percentage point to 70 percent and 71 percent, respectively, compared to Q4 2022.
According to JLL Indonesia head of research Yunus Karim, Grade A office space actually recorded positive net absorption at around 10,000 square meters in the first three months of this year. However, the completion of the Jakarta Mori Tower in Sudirman and the Lippo Tower in Cempaka Putih added 117,200 sqm to the supply.
The trend pushed the rental rate of CBD office spaces down by 2.3 percent and office buildings in TB Simatupang area by 0.7 percent.
Angela Wibawa, head of office leasing advisory at JLL Indonesia, shared that the demand for CBD office spaces has increased last year, and will continue at the beginning of this year as the government lifts social restrictions. However, due to challenging economic conditions, those tenants come with a cost-saving consideration in mind.
"With the hybrid working trend and [employee] downsizing that has been conducted by tenants, they are considering moving into a smaller office space. There is also a trend to move from older office buildings to a new one," Angela explained.
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