Opening of the city’s first mass rapid transit network buoy hopes up ahead of election headwinds
Market observers in Jakarta are cautiously optimistic on the property industry’s prospects this year as the Indonesian city gets a move on major transport infrastructure developments.
Jakarta’s first Mass Rapid Transit (MRT) network is set to open by the end of the first quarter. Connecting with the airport rail link and, later, with the Light Rail Transit (LRT) system, the network will be a colossal boost to connectivity for commercial and residential developments in the CBD and South Jakarta, according to JLL Indonesia. It will also connect the city centre to districts toward the east and south of the metropolis.
“We are cautiously optimistic on the year ahead and, on a personal note, I am very hopeful on the positive impact the MRT and LRT will have on Jakarta’s infamous traffic congestion,” said James Taylor, head of research at JLL Indonesia, in a statement.
Transit oriented developments (TODs) are expected to open up previously less accessible areas of Jakarta to developers. However, sentiment of investors and residential buyers will likely get repercussions from the presidential election in April, Taylor cautioned.
Businesses are expected to regain normalcy after the seasonal Ramadan slowdown and the subsequent Lebaran holiday, he said.
Co-working and technology companies will drive Jakarta office demand, although new supply is expected to put pressure on occupancy levels and rents. The logistics warehouse market will remain a “stand-out sector” as occupiers require more last-mile delivery centers.
Adapting to changing consumer preferences, retail landlords will make room for more food & beverage tenants, fast fashion retailers and entertainment occupiers.
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