Jakarta retail occupancy rate to remain stable at 75% by end-2024

Thanks to committed tenants in upcoming malls.

According to a Colliers report, the Lunar New Year celebrations in early 2024 increased visitation numbers to several malls in Jakarta. Apart from sales promotions, various events and exhibitions were also held, all aimed at encouraging retail businesses to reach pre-pandemic conditions.

Since the end of 2023, in pursuit of the holiday season, the number of stores opening continued to increase. F&B retailers remain dominant in occupied retail space. Encouraged by positive performance, several pastry businesses are growing, along with newly-established coffee shops planning to open more outlets. 

Here’s more from Colliers:

Anchor tenants such as multi-brand stores are expanding, particularly in the southern Jakarta area. In the fashion sector, especially in the footwear category, several local brands are adding outlets. Additionally, household equipment, gym electronics and accessories are regaining traction.

In addition to physical improvements, several malls are establishing strategic partnerships with well- known tenants to maintain attractiveness for visitors and potential tenants. The results of these partnerships are slowly being felt by retailers, as they are expected to attract more visitors and, in turn, other retailers join in. Apart from specialty stores, supermarkets with specific merchandise specifications are expected to attract more visitors. Consequently, the increasing number of visitors is expected to instill more confidence in other tenants to commit to opening their shops.

The absence of new malls in the last two years has positively impacted the recovery of occupancy, especially in Jakarta. The average occupancy rate was 74% in 2023, a 5% increase compared to 2022. With most committed tenants in the fitting-out process, the average occupancy in Jakarta remained relatively stable at 74.2% in Q1 2024. More retailers will officially open their outlets in time for the next festive season, affecting the projected occupancy rate in Q2 2024. Despite the anticipated new supply, the average occupancy rate in Jakarta is expected to be maintained at 74%-75% until the end of 2024, thanks to committed tenants in upcoming malls.

In the Greater Jakarta area, the average occupancy was 70.3% in Q1 2024. Although newly operating malls have secured committed tenants, some retailers have yet to open at the opening of the malls. The average occupancy is expected to rebound; however, in view of the large additional supply, it may take longer for average occupancy to return to 80%.