"Cushman & Wakefield is well-positioned to weather the current economic maelstrom," explains Michael Thompson, CEO of C&W's Asia Pacific operations, in a statement. "Whist many companies in our industry are scaling back, we are doing the opposite. As a private company with limited debt, we are able to move forward with our aggressive growth plans."
PROVIS will bring 80 employees, including David Cheadle who will assume the role of Managing Director, Indonesia. The Indonesian associate will provide the same global service as other C&W outposts; research & advisory, investment, tenant representation, design & project management, property & facilities management, and marketing consultancy for offices, residential, retail and industrial.
Arshpreet Chaudhry, executive Manging director of C&W in South-East Asia points out, in a statement, "With a population of 220 million and a strong emerging economy supported by large natural gas and petroleum reserves, Indonesia is increasingly a key focus market for our clients…"
Indonesia, recently posted a GDP growth, up to 6.4% in the Q2 from 6.3% in Q1. According to a C&W report, the GDP growth rate is around 5.5% since 2004 and maintains a stable currency. The real estate is "relatively inexpensive", according to a C&W release, and a recent investment law which "enshrined the right for all investors--both foreign and local to be treated the same" is predicted to "further stimulate investment activity in the property sector."
The detractions for investment in Indonesia seem to be the decentralized government, leading to a general sense of instability. The hope is that the "markets in Asia post 1997 crisis are increasingly interdependent in equity markets and intra-regional trade," according to C&W's report.
As it stands, Indonesian land cannot be held by foreigners, but can be leased for 25 years, although it retains no intrinsic value for the leasor after this time. As Indonesia relaxes some of its other tax laws regarding property--a softening of the ownership and leasing laws regarding foreign investment--could bring a large reward to those willing to take the risk. Dr. Megan Walters chief economist for C&W's in Asia Pacific points out in a statement, "For investors who are prepared to take a long term view, Indonesia has a great deal to offer. It is a low cost base from which to operate, and is expected to continue to be cheaper than neighboring countries." Walters is the author of C&W's report Indonesia--At the Crossroads, which details the region from a real estate perspective.
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