Office development in Jakarta, so far, has been concentrated in the CBD. This area is bounded by three major streets (i.e. Sudirman-Thamrin, Rasuna Said and Gatot Subroto) forming a triangle, hence fondly known as “the golden triangle zone” among the locals.
In the initial phase of its development (back in the 1970s), the golden triangle zone was dominated by central government buildings, offices of major state-owned companies and foreign embassies. Later, other Indonesian enterprises and international companies began to locate their offices in the district with significant office development taking place during the economic boom in the mid-nineties. Since then, the golden triangle zone has continued to attract developers, investors and various corporations, and becoming what is now the central business district (CBD) of the capital city today.
And up until the present, the golden triangle zone, or the CBD, has managed to retain its status as the most prominent and prestigious business district in Jakarta.
However, along with the growing demand from various businesses and the development of Jakarta’s infrastructure, the city landscape has changed with the emergence of new commercial districts.
The most popular amongst them is the TB Simatupang area in South Jakarta. It is situated close to the upmarket residential districts of Pondok Indah and Kebayoran Baru (both popular with expats) and has excellent access via the outer ring toll road. It has attracted many corporate occupiers mainly from oil and gas, consumer goods and engineering companies.
Other growing commercial districts in Jakarta include Kemayoran and Slipi-Grogol. While Kemayoran (former site of the Jakarta international airport) has been designated by the city government as the future CBD, the area alongside Slipi-Grogol has grown as an alternative business location for small-to-medium sized companies, particularly in trading businesses.
Another district, which has been quietly developing into a commercial district, is the By-pass area, stretching from Cawang in the east to Priok in the north. Besides being right alongside the Jakarta inner city toll road, this area is also in close proximity to the seaport and has good access to the airport. Naturally, the area is popular among Indonesian industrial conglomerates like Astra and Gudang Garam for their headquarters and of late has also attracted more companies especially from the automotive, trading and logistics sectors.
While the golden triangle zone will remain as the primary CBD of Jakarta, these other commercial districts such as TB Simatupang, Kemayoran, Slipi-Grogol and the By-pass area will remain attractive as they provide the benefit of lower rents, higher flexibility in lease terms and better accessibility. Generally, banks, insurance, securities and professional services prefer the CBD, but with rising rents coupled with a lack of available space and the bad traffic situation, non-financial service companies will certainly consider these decentralised locations.
About the author
Anton Sitorus is the Head of Research for Jones Lang LaSalle in Indonesia.
