East Indonesia the fastest rising in the country

Bank Indonesia’s (BI) latest survey has revealed that property prices in major Eastern Indonesian cities have indicated an upward trajectory owing to the stronger purchasing power of its citizens and an increase in housing investments.

During the April to June period, the index of residential property prices in Manado of North Sulawesi, experienced the largest quarter-to-quarter rise of 9.5%, followed by Makassar in South Sulawesi, with an increase of 6.5%.

The rise of property prices within the two cities was significantly above the overall average of Indonesian cities. BI’s residential property prices index, including 16 major cities in Indonesia, only increased by 1.7% quarter-to-quarter during the same period.

Property shares gain today

Indonesian stocks grew for a second day today, before of the central bank’s monthly meeting on monetary policy.

The benchmark Jakarta Composite Index (JCI), gained 19.15 points (equivalent to 0.4%), to 5,132.39, expanding Monday’s 1.2% advance. Approximately 6.1billion shares valued at Rp5.5trillion ($466million), altered hands on the Indonesia Stock Exchange (IDX). This is still visibly lower than its year’s daily average turnover of Rp6.2trillion. Gainers were ahead of decliners by 181 to 103. Foreign investors accounted for Rp3.5trillion or 64% of the total trading value. They purchased Rp452.4billion in shares more than they sold.

Bank Indonesia, the Nation’s central bank is scheduled to announce its decision on interest rates this Thursday. Economists assume the central bank will maintain its policy rate at 7.5%. It has kept its rate unchanged since November following a gradual increase by 175 basis points in recent months.

All sectors with the exception of agriculture and miscellaneous, grew on the local bourse. Property shares as group, led sectors, with a 0.9% gain. Lippo Karawaci, one of the major property developers of Indonesia, increased 3% to Rp1,205. Surabaya based, Pakuwon Jati gained 2% to Rp445. Infrastructure stocks gained 0.9%. State-owned toll road operator, Jasa Marga contributed 1.6% to Rp 6,250.

Basic industry increased by 0.7%.The manufacturing unit of state controlled construction company Wijaya Karya, Wijaya Karya Beton gained 1.6% to Rp950.

The rupiah strengthened 0.4% to 11,677 against the US dollar from 11,728 on Monday, according to Bank Indonesia data. The yield on the government’s ten year note fell to 8.3541% from 8.3654%, as seen in data from the Indonesia Bond Pricing Agency.

Bali's economy to grow this second quarter

Bank Indonesia for Bali and Nusa Tenggara have predicted that with this national school holiday coinciding with the fasting month, economic growth will be motivated for the second quarter of this year. This is compared to last year.

It was claimed that the diversion of foreign tourists to Bali from Thailand could expect a lift to Bali’s economy during this second quarter. He also felt that, based on surveys conducted by Bank Indonesia, consumer and business confidence would remain high in the second quarter.

Economists at Bank Indonesia also feel that Bali’s agricultural sector would positively contribute to the Island’s economy due to prevalent good weather conditions. This good weather is anticipated to positively impact Bali’s fishing sector.

Favourable conditions sustain Bali’s economy which Bank Indonesia predicts will grow at a rate of 5.2-5.8% during the second quarter of 2014.

Economic growth in Bali was at 5.43%.

Commercial Property stocks have gained highest profit this year

The Indonesia Stock Exchange have revealed that investors who concentrated on property, infrastructure and banking stocks have gained the highest profit so far this year, standing out as Indonesia’s top performers. All sectoral indices contained within the benchmark stock index of Indonesia, referred to as the Jakarta Composite Index (IHSG) have also shown good performance. Indonesia's IHSG has grown by 16.14% during 1^st January to 26^th May, this year.

The property sectoral index of Indonesia grew by 28.15% between 1^st January and 26^th May, followed by the financial (up 23.62%) and infrastructure (up 17.99%) sectors. With the exception of healthy general economic growth, the property and infrastructure sectors gained a boost from the political agendas of two presidential candidates – Prabowo Subianto and Joko "Jokowi" Widodo. Both candidates target accelerated infrastructure growth, with improved quantity and quality of infrastructure, whereby investments in real estate and property become more attractive.

Property investment volume increase in Asia Pacific

This year, Cushman and Wakefield assume that the Asia Pacific’s markets will continue to strive, parallel to the rising worldwide economy and growing domestic demand.

The gradual rise in property investment within the Asia Pacific supports the assumption – Cushman and Wakefield predict a 7 to 8% increase in the activity.

The Asia Pacific region saw an increase in investment within all areas of the Asia Pacific in 2013, with a 25% increase delivering a volume of US$568.6billion at the end of the year, equivalent to 48% of the global market.

Cushman and Wakefield concluded that rises would continue for at least two years as economic growth results in growing demand within the property industry, which in turn pushes rent higher.

Asia's Hotel Sector is Growing!

Just a reminder that Asia’s tourist and hotel sector is vibrant at the moment! Yes, that includes Indonesia! Bangladesh has the highest expected supply growth at a whopping +261.1% and Indonesia is one of the six Asian countries with over £30% room growth expected:

• Mongolia - +77.4%, with 975 extra rooms

• Myanmar - +67.5%, 4,109 rooms

• Sri Lanka - +51%, 5,204 rooms

• Bhutan - +46.7%, 78 rooms

• Indonesia - +35.7%, 53,100 rooms!

• Philippines - +30.7%, 13,078 rooms

Indonesia and Asia may need to you to search for your hotel commercial property on www.commercialpeople.co.id soon!

Growth in Indonesia's Developer Companies

Bumi Serpong Damai (BSD), one of Indonesia’s largest developers, has announced company organic growth during the first quarter of 2014 at approximately 43%. This is as Rp1.25trillion organic revenue was gained, outperforming last year’s Rp877.54billion gain.

Approximately 44% or Rp549.36billion of this first quarter revenue, owes to the residential sector, rising by approximately 70% year over year. The sale of lots was the second largest generator of revenue, with Rp284.49billion.

 

The commercial sector sales took the lead in growth during the first quarter, growing by eightfold to Rp191.58billion compared to the Rp23.9billion during the same quarter last year.

 

Furthermore, Ciputra Development doubled its shop house and residential sales to Rp834.62billion rin the first quarter of the year compared to Rp481.92 during the same quarter last year.

 

Agung Podomoro Land saw its first quarter revenue grow from Rp1.12trillion last year to Rp1.16trillion; as it also saw its profit grow slightly from Rp272.4billion to Rp281.58billion.

 

Agung Podomoro Land’s marketing sales grew during the first quarter by 6% year over year to Rp1.83trillion. Harco Glodok, the company’s electronic shopping centre in West Jakarta, generated 32% of the total figure - followed by, alongside other complexes, the housing complex Orchard Park Batam of the Riau Islands generating 27.2%; Podomoro City Deli Medan super blocks of North Sumatra generating 12.7%; and Podomoro City Extension of West Jakarta generating 8%.

Why not search for your property too? Let it grow and gain.

www.commercialpeople.co.id

Developer Pakuwon Jati Sees Profit Growth of 51% for 2013

Jakarta. Pakuwon Jati, a property developer, saw a 51.3 percent increase in profit last year on rising revenue.

Net income at Pakuwon rose to Rp 1.13 trillion ($99.3 million) last year from Rp 748 billion in the previous year. Revenue increased to Rp 3.03 trillion from Rp 2.16 trillion in a year earlier, the company said in a statement released in Jakarta on Monday.

Irene Tedja, head of investor relations at Pakuwon, said that development revenue — income from the sales of apartments and residential units — accounted for 53 percent to its total revenue.

The development revenue stood at Rp 1.59 trillion last year, Irene said adding that it had grown 30.6 percent from 2012.

The company benefitted from apartment sales at its Education City apartment block and landed residential unit sales at the Pakuwon City residential area, both located in Surabaya, East Java.

Irene said the rest of the company’s total revenue came from its recurring revenue — or income coming from the rental fees of malls, office towers, and hotels.

The company raked in Rp 1.43 trillion in recurring revenue last year from Rp 943 billion in the previous year.

Irene said the recurring revenue growth was supported by rent fees from its Kota Kasablanka mall in South Jakarta, Gandaria City super block in South Jakarta and the Tunjungan City super block in Surabaya, East Java.

Pakuwon expects to receive additional revenue from the expansion project of Tunjungan City, which is currently under construction, Irene said.

The expansion project includes two retail malls, two condominium towers, and a four-star hotel.

Pakuwon plans to build a condominium and office tower at the Kota Kasablanka super block. The Pakuwon City residential area will see the addition of a new landed residential cluster at this year.

Pakuwon Jati shares closed unchanged at Rp 354 on the Indonesia stock Exchange (IDX) on Monday.

Source: www.thejakartaglobe.com