diff --git a/java/target/env-default-rules.sh b/java/target/env-default-rules.sh
index 1ebb1dfa9e1..e519eeaf44f 100755
--- a/java/target/env-default-rules.sh
+++ b/java/target/env-default-rules.sh
@@ -90,3 +90,16 @@ fi
 if [ -z "${SERVER_STARTUP_NOTIFY}" ]; then
   export SERVER_STARTUP_NOTIFY=simon.marcel.pamies@sap.com
 fi
+if [ -z "${MEMORY}" ]; then
+  MINIMUM_MEMORY_IN_MB=2000
+  MEM_TOTAL=`cat /proc/meminfo  | grep MemTotal | awk '{print $2;}'`
+  MEMORY_FOR_APPLICATIONS=$(( ${MEM_TOTAL} / 1024 * 3 / 4 - 1500 / 1 ))
+  if [ -z "${TOTAL_MEMORY_SIZE_FACTOR}" ]; then
+    # All of the MEMORY_FOR_APPLICATIONS goes to this application
+    MEMORY_PER_INSTANCE_IN_MB=$(( ${MEMORY_FOR_APPLICATIONS} < ${MINIMUM_MEMORY_IN_MB} ? ${MINIMUM_MEMORY_IN_MB} : ${MEMORY_FOR_APPLICATIONS} ))
+  else
+    # Only a fraction (1/${TOTAL_MEMORY_SIZE_FACTOR}) goes to this application:
+    MEMORY_PER_INSTANCE_IN_MB=$(( ${MEMORY_FOR_APPLICATIONS} / ${TOTAL_MEMORY_SIZE_FACTOR} < ${MINIMUM_MEMORY_IN_MB} ? ${MINIMUM_MEMORY_IN_MB} : ${MEMORY_FOR_APPLICATIONS} / ${TOTAL_MEMORY_SIZE_FACTOR} ))
+  fi
+  export MEMORY="${MEMORY_PER_INSTANCE_IN_MB}m"
+fi
\ No newline at end of file
diff --git a/java/target/refreshInstance.sh b/java/target/refreshInstance.sh
index ebb4cf54b4c..2422149f478 100755
--- a/java/target/refreshInstance.sh
+++ b/java/target/refreshInstance.sh
@@ -283,8 +283,7 @@ auto_install ()
         # make sure to reload data, this time including defaults from release's env.sh, environment settings and user data
         source `pwd`/env.sh
         if [ -z $MEMORY ]; then
-          # Compute a default amount of memory based on available physical RAM and the number of applications, with a minimum of 2GB:
-          NUMBER_OF_INSTANCES=`echo "$JAVA_START_INSTANCES" | wc -w`
+          # Compute a default amount of memory based on available physical RAM, with a minimum of 2GB:
           MINIMUM_MEMORY_IN_MB=2000
           MEM_TOTAL=`cat /proc/meminfo  | grep MemTotal | awk '{print $2;}'`
           MEMORY_COMPUTED=$(( ${MEM_TOTAL} / 1024 * 3 / 4 - 1500 / 1 ))