What: Simon Property Group is now setting its focus on Indonesia with a first outlet center in Jakarta.

Why it is important: With the slowdown in developed markets, international players are looking for new relays of growth at a moment when developing markets are maturing.

Simon Property Group has initiated construction on its first premium outlet center in Indonesia, set to open in West Jakarta by early 2025. This venture, in collaboration with Genting, aims to introduce Indonesians to upscale brands at more accessible prices. The centre will feature 150 stores and eateries over 28,000 square meters, strategically located near a major highway and the densely populated Jakarta metropolitan area.

The move capitalizes on Southeast Asia's growing middle class, which is increasingly brand-conscious yet value-oriented due to economic pressures. Jakarta, now classified as an 'upper middle-income country' by the World Bank, has a significant consumer base with disposable income, making it ripe for such development.

Simon's foray into the Indonesian market is part of a broader strategy to expand internationally in regions with rising incomes and untapped market potential, as the U.S. nears saturation for malls and outlets. The company, which is performing well with net income of $1.5 billion from revenue of $4.1 billion over nine months, sees international development as a key priority moving forward. Simon’s Jakarta Premium Outlets will be their 19th in Asia, joining other successful outlets that have shown strong sales figures pre-Covid. The new outlet will face competition from The Grand Outlet – East Jakarta, a venture by Tuan Sing Holdings and Mitsubishi Estate, scheduled to open earlier with a different configuration and possibly a different brand mix.

Why Jakarta is the next destination for premium outlet retailers