Jakarta Grade A office vacancy rate to drop to 32% by year-end

Thanks to sustained absorption in premium buildings.

Jakarta’s Grade A office market is set for continued improvement as a thin future supply pipeline underpins occupancy gains and rental growth, according to a report by JLL. With no significant new Grade A completions expected until 2028 and 2029, the consultancy believes the extended period of limited inventory will provide room for landlords to strengthen occupancy and pricing.

JLL projects the overall vacancy rate to decline further to around 32 percent by the end of 2026, supported by sustained absorption in premium buildings and well-located Grade A assets. The firm noted that strong demand for high-quality space in favoured locations is likely to continue driving the market’s gradual recovery.

In 2025, Grade A office space recorded substantial positive net demand, with annual net absorption reaching approximately 86,000 sqm. Leasing momentum was particularly strong in the fourth quarter, which alone saw around 38,000 sqm absorbed. According to JLL, the oil and gas sector led leasing activity by volume during the year, followed by financial services and technology companies.

The final quarter received a significant boost from oil and gas occupiers, which accounted for more than half of total net absorption. JLL highlighted a major relocation into the CBD, where an oil and gas company consolidated operations by moving more than 25,000 sqm into the newest CBD development. This trend reflects a broader pattern of relocation and rightsizing, as companies optimise their real estate footprints while upgrading to higher-quality premises.

Notably, no new Grade A office buildings were completed in 2025. JLL said this absence of fresh supply provided landlords with an opportunity to improve occupancy levels amid strengthening demand. By the end of 2025, the overall Grade A vacancy rate stood at approximately 33 percent, representing a 2.3 percentage point improvement compared with the same period in 2024. The decline was attributed to the combination of limited new supply and stronger-than-expected leasing activity.

Rental performance also reflected tightening conditions. JLL reported that Grade A rents increased by 0.87 percent quarter-on-quarter in the fourth quarter, bringing full-year rental growth to 3.68 percent. Premium office buildings achieved particularly strong occupancy levels during the year, supporting upward rental adjustments.

According to JLL, high-occupancy assets within the Premium segment in preferred locations were the primary drivers of rent growth. However, landlords with relatively higher vacancy levels remained flexible in negotiations, ensuring that tenants seeking space could still secure competitive terms in certain buildings.

Looking ahead, JLL expects the constrained supply pipeline to play a pivotal role in sustaining market improvement. With no major Grade A developments anticipated in the near term, the market is likely to see continued vacancy compression and steady rental increases, particularly in top-tier assets.

As relocation and rightsizing strategies persist across key industries, JLL maintains that Jakarta’s Grade A office sector is positioned for gradual but sustained recovery, supported by disciplined supply and resilient occupier demand.