LIPPO-MAPLETREE - Lippo Malls Indonesia Retail Trust - Investor ...

Leased MallsFigure 4.1.4 Cibubur Junction—mall atriumSource: Jones Lang LaSalle Research and ConsultingWhile lack of parking within the centre remains an issue, management is negotiating with an adjoining landowner to gain access to additional parking spaces. This should alleviate congestion at the centre,particularly on weekends, improving customer perceptions of the centre and helping to increaseshopper traffic at peak trading periods.Table 4.1.7: Rental positioning, Cibubur JunctionTenancy categoryAveragecurrent rents(Rp./sqm/month)Estimated rangeof market rents(Rp./sqm/month)Growth prospectsAnchor Tenants . . . . . . . 47,000 45,000 - 50,000 Potential growth upon lease renewalMajor Tenants . . . . . . . . 58,000 50,000 - 70,000 Potential growth upon lease renewalSpecialty Tenants . . . . . 229,000 200,000 - 230,000 Potential growth upon lease renewalF&B, Restaurants . . . . . 192,000 150,000 - 200,000 Potential growth upon lease renewalSource: Jones Lang LaSalle Research and ConsultingWhile rent levels are considered to be currently at market, rental growth should be positively influenced bythe above mentioned factors, which include:• Growth in target middle-upper income market• Expansion of anchor store, Matahari, improving traffic flow• Potential for additional major stores, or mini-anchors• Increased overall occupancy levels• Improved parking• Strong market position, with no new proposals currently in the pipelineGrowth prospects of major and anchor tenants may be limited in the short term due to long lease terms, butconsiderable potential exists to grow specialty and F&B rentals due to the combination of these factors atlease renewal. Furthermore, the care that has been taken with retail zoning and attracting tenants thatcomplement the existing mix should support long term growth in shopper traffic, turnover and ultimatelyrental income. Considering these factors and the potential growth of retail spending in the trade area,average rents of CJ are projected to grow at approximately 11-13% per year across 2007-2009.At present, no proposals currently exist for new centres to compete directly with CJ. However, given theattractiveness of its position as the only centre in the region serving the growing number of middle to upperincome households in its immediate catchment, CJ should aim to consolidate its position as the leadingshopping centre within its trade area. Centre management should ensure it follows through on theabovementioned improvements to the centre to ensure that it is appropriately prepared for the potentialopportunistic entrance into the market by a competing centre in the medium to long term.F-56