Oversupply Offices Are Still Challenges For Astra Property Sales

President Director of Astra Property Wibowo Mujono (rightmost). Photo: Theresia Agatha/VOI

JAKARTA - The office property market in Jakarta is still overshadowed by the challenges of oversupply even though it has shown a recovery trend. Astra Property President Director Wibowo Mujono said this condition had been seen since before the COVID-19 pandemic and until now the industry is still in the recovery stage.

"Friends, everyone may have heard this often, yes, we are oversupply. If we look here, actually 2019 to 2022 there has been an oversupply movement. In fact, before COVID-19, we saw that the occupancy in the market had started to decline. COVID only made the situation worse and at this time for offices, in general it is still in the recovery stage," said Wibowo at the Astra Media Day 2025 event in Jakarta, Tuesday, September 23.

Even so, Wibowo emphasized, Astra Property still recorded solid performance in the commercial sector. For example, Astra Tower, which posted an occupancy rate of around 95 percent, is far above the average Jakarta office market, which is around 50 percent.

Astra Property is also developing the Arumaya Office by adopting modern design principles which are expected to replicate the success of the Astra Tower.

In addition to offices, Wibowo conveyed developments in the residential segment. For landed housing, the market shows resilience with a stable sales rate at around 87 percent.

However, for apartments (high-rise), markets are still stagnant due to increased supply, while sales are not moving significantly. The shift in consumer profiles also occurred, from the previous majority of investors now turning to end-users.

In addition, Astra Property is now starting to strengthen its portfolio in the industrial segment, especially the modern warehouse.

According to Wibowo, the modern warehousing market continues to grow along with increasing demand from the logistics sector, although the increase in rental rates is not expected to be as high as before.

"We see this promising market, because every new supply is always absorbed," he said.

As part of the diversification strategy, Astra Property has also signed a Conditional Sale and Purchase Agreement (CSPA) to acquire 83.27 percent of Mega Manunggal Property (MMP) shares, the largest modern warehouse manager in Indonesia with a portfolio of more than 400,000 square meters.

The move is believed to strengthen market leadership, provide long-term land banks and provide platforms for further expansion.

In addition to focusing on the business portfolio, Astra Property emphasized that all projects developed are based on the principles of sustainability and safety. All properties built have pocketed environmental certification, which is the standard in the company's development.