SALES OF INDUSTRIAL ZONES ROSE BY 140%

Sales of industrial zones in second quarter of 2010 rose by 140% or by 99.6 hectares. This was the highest increase in the past five years.

According to Associate Director for Cushman $ Wakefield industrial sector, Wira Agus, increase of sales of land in the industrial zones were due to improvement in investment climate in Indonesia, which was supported by growth of real GDP, which, until June 2010, based on data of the Central Board of Statistics (BPS), reached 5.5% - 6%.

Based on the research conducted by Cushman & Wakefield on sales of land in industrial zones, in semester I of 2010, 140.7 hectares of land were sold. In first quarter of 2010, 41.1 hectares were sold and the remaining were sold in the second quarter. “If compared to second quarter of 2009, demand this year increased more than five times”, Wira said.

Even though there was increase of sales, the cumulative rate of absorption in second quarter declined due to increase of supply. In first quarter of 2010, absorption rate reached 73.6%, and in second quarter of 2010, only 72.5% was absorbed. But, this rate was higher than in second quarter of 2009 which was only around 72.4%.

Total cumulative demand for industrial zones, based on research of Cushman & Wakefield, was estimated to reach 5,897 hectares. While, the supply of spaces in the industrial zones reached 8,134 hectares. It was estimated that total demand for industrial zones this year could reach more than 200 hectares, or increased significantly if compared to total demand in 2009 which only reached around 134 hectares.

Arief Raharjo, Associate Director of Cushman & Wakefield, said that the increase of demand in the second quarter was anticipated by the launching of 257 hectares of new available spaces by Lippo Cikarang and Modern Cikande so that total cumulative supply of industrial area in Jakarta will rise by around 3.3%. Supply would continuously increase. There will be new supply of area of 300 hectares in Karawang, so until the end of this year it was estimated that there would be 500 hectares of new spaces available in industrial zones.

Arief stated that increase of sales of land in the industrial zones was as a result of Government Regulation No. 24/2009 concerning Industrial Zone which was already implemented. “The Government Regulation obliges construction of factories in industrial zones so that industrial development would be focused on industrial zones”, he said.