Office buildings in Singapore’s city fringes may be increasingly left vacant as tenants seek the opportunity to move into Grade A premises in the Central Business District (CBD) with rents weakening amid an onslaught of incoming supply. Pundits have blamed the weak office market here on a “fundamental miscalculation” on the part of some Singapore developers that had “misplaced optimism” that China would sustain its rapid pace of its growth and pull the rest of Asia along. With another 7 million square feet of new office space under construction at a time when businesses are holding back expansion plans, rents in Singapore will continue to tumble, analysts warned. Mr Nicholas Mak, executive director at SLP International Property Consultants, has forecast a 10 to 15 per cent fall in rents this year, accelerating from the 6.5 per cent decline last year.
The government has appointed to the Bureau of Logistic Affairs (Bulog) to import 600,000 tonnes of corn in 1Q16. However, the feedmill industry has also imported about 675,000 tonnes in the same period. All this while, all corn imports have been done by the feedmill industry. The Association of Indonesian Feed Producer (APPI) says that the Minister of Agriculture regulation no 57/2015 that bans the corn import cannot be implemented as the Ministry of Trade has not issued the related regulation. About 50% of animal feed content comprises of corn so that when the corn price increases, the feed price increases as well. If the feed price increases, then the cost of production for farmers will also rise. Currently, the corn price has reached Rp7,000/kg. The normal average corn price for feed used to be about Rp3,000-3,500/kg. The Ministry of Agriculture has attempted to increase the welfare of corn farmers and the corn price has been allowed to rise. However, the Ministry of Agriculture has been accused not being able to maintain the corn supply as the raw material for animal feed. Despite the ambiguity in import regulation, the feedmill industry continued to import corn in Dec 15, and these are targeted to arrive in Feb 16. If the corn imports arrive, total corn imports will be about 1,275,000 tonnes in 1Q16, or nearly 45% of the total import in 2015. APPI says that the feedmill industry does imports as they are uncertain about the corn supply being imported by Bulog.
Martina Berto (MBTO) has officially bought Rudi Hadisuwarno, a brand of beauty products and hair care with total transaction of Rp58b . The company used the IPO proceeds and bank loans to finance the transaction. The company targets to book 10% yoy total revenue growth this year and the jamuand cosmetic business is expected to grow 3.4% yoy.
Kimia Farma (KAEF) targets to achieve revenue of Rp3.0t from its drug store business, which is up 26% yoy. As at end-15, the company had in operation 725 drug stores including 10 units of one- stop healthcare solution (OSHcS), 315 clinics and 43 laboratories. The company will open 135 new drug stores and 50 clinics by investing Rp200b this year. Six of the 135 new drug store will be OSHcS units.
Destinasi Tirta Nusantara (PDES) plans to add 50 new units to its transportation fleet this year. The company also intends to expand its tourism destinations by opening two branches in East Indonesia. The company targets to double its revenue as well as tourist visitor numbers this year. As at end-15, the company had reportedly booked 115,000 pax which increased from 112,188 pax in 2014. About 50% of PGES’ tourist numbers come from Europe countries with the remaining coming from Asia and Middle Eastern countries. The company also plans to expand its tourism business to Vietnam, India, North America, Australia and Poland. On 28 Jan 16, the shareholder meeting appointed Renato Domini as the new president director, replacing Dharmayanto Tirtawisata.
As a sign of the current market conditions, a total of 104 property agencies and 3,573 real estate agents left the industry after the latest licence renewal exercise with the Council for Estate Agencies (CEA). The CEA had licensed 1,369 estate agents and registered 29,262 salespeople as at Jan 1, 2016. In the past year, there were 1,299 new salespeople who joined the industry, said CEA, which explained that the figure excluded those who left and rejoined. This is a drop from the 3,006 new salespeople in 2014.
President Jokowi launched the construction phase of the China-funded Jakarta-Bandung fast train, marking the country’s first such endeavor and opening up a host of investment opportunities in the sector . The project was launched in West Bandung and set to be completed in 2018 and will start operations in 2019. The project will employ as many as 20,000 local workers and boost investment in various railway-related sectors. The $5.5bn project will also contribute more than $450m in state revenue through the procurement of goods and services alone over the next 3 years.
Traditional brick and mortar retailers in Indonesia are facing growing pressure to strengthen their online channels in order to catch up with tech-savvy consumers amid rapid growth of pure e-commerce companies, gunning to enjoy a piece of the expanding middle class and increasing smartphone penetration. Estimates and forecasts on the size of the market in Indonesia vary, but global consulting firm Bain & Company estimated that Indonesia already has approximately 51m of digital consumers, or roughly 20% of the country’s 250m population, while technology market research firm International Data Corporation expects the market size to reach $5bn this year from $2bn in 2014.
President Jokowi kicked-off the development of the Jakarta-Bandung high-speed railway along with the development of economic centre of Jakarta-Bandung corridor. The railway is owned by PT Kereta Cepat Indonesia China (KCIC), which is a JV between Pilar Sinergi BUMN Indonesia (PSBI, 60%) and China Railway International (40%). Meanwhile, PSBI is a JV consisting four Indonesian SOEs: a) WIKA (38%), b) Kereta Api Indonesia (a railway company, 25%), c) PTPN VIII (an agriculture company,25%), and d) JSMR (a toll road company, 12%). The rail will have 140.9km of length and four stations, namely: a) Halim in Jakarta, b) Karawang in West Java, c) Walini in West Java, and d) Tegalluar in Bandung, West Java. The train is targeted to start operation in early-19. In each station, a Transit Oriented Development (TOD) will be built, and this TOD will be the embryo of the new economy region and new residential area.
In 2015, Astra’s products still lead the unit sales in the market. The top 10 cars in Indonesia in terms of unit sales are: 1) Toyota Avanza – 133,153 units. 2) Toyota Agya – 56,583 units. 3) Honda Mobilio – 48,927 units. 4) Toyota Kijang Innova – 45,411 units. 5) Daihatsu Ayla – 36,468 units. 6) Daihatsu Xenia – 35,057 units. 7) Suzuki Ertiga – 32,871 units. 8) Honda Brio – 31,672 units. 9) Datsun Go – 29,651 units. 10) Honda HR-V – 28,897 units.