Jakarta CBD average office rents decline 7% in 2024

It was part of landlords’ ongoing efforts to boost occupancy rates.

The tenant market continued in Jakarta’s office sector in 2024, and as a result, some landlords kept providing competitive rental packages in response to favor tenants.

According to Colliers, office buildings with relatively lower occupancy rates are still affected by the policy of providing rental packages to achieve healthier levels. As a result, some landlords provide discounts and flexible terms to encourage tenant relocations.

Here’s more from Colliers:

In 2024, the average rent in the CBD was registered at IDR 218,744, reflecting a marginal decrease of around 7% compared to 2023. A decline in rental rates was part of landlords’ ongoing efforts to boost occupancy rates, which seem to be showing the intended result. As a result, the gap between current asking rents and transacted rent may continue to narrow.

Outside the CBD continues to offer a compelling alternative for businesses, particularly those prioritizing cost efficiency. The average rent for this area was recorded at IDR 166,888 per sq m per month in Q4 2024, showing modest growth compared to the previous quarter. With a wide range of building options, each offering unique advantages, rents outside the CBD are projected to grow by approximately 3% annually through 2028.

In addition, the average rent of grade A office buildings outside the CBD was documented at IDR 206,435, reflecting an adjustment compared to Q3 2024. Notably, certain office buildings in TB Simatupang continue to demonstrate their prominent quality and are expected to be positioned as competitors to those located in the CBD. The area offers tenants more diverse options, catering to varied preferences of excellent office spaces outside the CBD.

Service charges remained relatively stable in 2024. In the CBD, the service charge was registered at IDR 86,042, while it was IDR 63,425 outside the CBD. Due to operational costs, the service charge is forecasted to increase by around 2%-3% in 2025, mainly driven by labor costs.

To ensure a smoother transition, landlords may communicate early and intensively about the plan for operational cost adjustments so that tenants' budget planning is not unduly disrupted in the coming years.