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

Leased Malls4.2.8 Future outlookDespite the constant threat of new competition in the Jakarta retail market, the future outlook for The PSremains bright. The centre’s strategic location, combined with its unique tenancy mix, means that newentrants to the retail market in Jakarta are unlikely to compete directly with the subject site. Furthermore,The PS benefits from its relatively recent construction date (compared with older malls around Jakarta),meaning it is less likely to appear ‘dated’ in comparison with new competitors.There are a number of strong, well advanced opportunities for The PS to improve upon its performance inthe short to medium term. New retail concepts such as Plangi on the Sky, the proposal to add a 3,000 sq.mcafé and restaurant, is one such opportunity which is well advanced. The opening of the buswayinterchange bridge, which will also include the addition of new tenants around one area of the centrewhich is currently underperforming, is another sound opportunity. Both of these proposals have thepotential to assist centre management with reinforcing the tenancy mix, while they will also add to thecentre’s vibrancy (thereby addressing the challenge posed by new shopping centre developments),diverse retail offering and income.Figure 4.2.5 The Plaza Semanggi—Centre AtriumSource: Jones Lang LaSalle Research and ConsultingThese factors all point to strong growth prospects for income growth at The PS in the short to mediumterm. Furthermore, it is considered that the PS’s current rental positioning is below market, providingconsiderable upside for most tenancy categories at lease renewal. Considering these factors and thepotential growth of retail spending in the trade area, average rents of PS are projected to grow atapproximately 10-12% per year across 2007-2009.Table 4.2.7: Rental positioning, The Plaza SemanggiTenancy categoryAverage currentrents(Rp./sqm/month)Estimatedrange ofmarket rents(Rp./sqm/month)Growth prospectsAnchor Tenants. . . . . . . 55,000 50,000 - 60,000 Potential growth upon lease renewalMajor Tenants . . . . . . . . 72,000 70,000 - 100,000 Potential growth upon lease renewalSpecialty Tenants . . . . . 219,000 225,000 - 275,000 Potential growth upon lease renewalF&B, Restaurants . . . . . 216,000 200,000 - 250,000 Potential growth upon lease renewalSource: Jones Lang LaSalle Research and ConsultingOverall, The PS is well positioned to compete with new entrants to Jakarta’s growing retail market. Thecentre is well positioned in terms of its target market, with the centre targeting a slightly lower market thanmany of its existing and proposed competitors around central Jakarta. The centre is well positioned inF-66