Bank Indonesia (BI) is optimistic that the commercial property business in Bali will grow in 2018 despite the impact of Gunung Agung.
Demand for hotel rooms in Bali, Indonesia's most popular tourism destination, is expected to improve, which Bank Indonesia predicts will be followed by retail properties, especially those that carry lifestyle or lifestyle concepts related to food and beverage operations, supermarkets and cinemas.
In Q4 of 2017, BI conducted a commercial property survey covering offices, retail space, apartments, star-rated hotels and industrial estates across the country including in Badung and Denpasar.
The results show rental prices for offices and apartments are stable. The average price for office space was IDR 130,000 per square meter per month with apartments reaching IDR 13.2 million per square meter. Both show little or no change from Q3 of 2017.
Retail prices of shopping centers and hotel rooms however, tend to decrease when tourist numbers fall, which has happened recently with the eruption of Mount Agung.
Occupancy rates for shopping centres in Bali still remains high at 85.4%. This figure, according to Nusa Bali covers 11 shopping centers.
But it's Bali's hotel room rates that have suffered most from Mount Agung's disruption. BI's survey found average room rates fell from IDR 1.5 million in Q3 of 2017 to IDR 1.27 million per night in Q4.
Sources: Nusa Bali, Antara News, Bank Indonesia
This article was previously published on Gapura Bali.
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