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B5bn vote of confidence from Israel
By admin | June 5, 2009
Source - Bangkok Post Website
May 28, 2009
Pace mixed-use project worth B18bn
The Israeli investor Fishman Group has cast a vote of confidence in Thailand, planning to invest 5 billion baht in a property joint venture with Pace Development.
The partners will develop the MahaNakhon mixed-use project worth a total of 18 billion baht near the Chong Nonsi BTS station. One of its towers would become the tallest in the country.
“We have faith in the [Thai] government, economy and property market,” said Anat Menipaz, daughter of the group’s founder, Israeli business tycoon Eliezer Fishman.
The group had postponed an announcement of the venture on April 22 due to the political unrest at the time. However, she said the company was well accustomed to turmoil in Israel.
“The Thai property market is interesting for an investment. Prices are still lower than those in Hong Kong and Singapore. And we want to invest in a project that can become a landmark of the city,” she added.
She said the group invested in MahaNakhon through Tel Aviv-listed Industrial Buildings Corporation (IBC). The partners were introduced last year by Jacob Ben-Moshe, partner of Dragon Pearl Partners.
Pace Development will invest the same amount as the Israeli partner in three subsidiaries, the project’s developers, in which Pace holds 51% and IBC 49%.
“We’re looking for the right partner with experience worldwide and strong financial status,” said Sorapoj Techakraisri, chief executive of Pace Development, owned by the family.
Mr Sorapoj said the nine-rai plot close to the Chong Nonsi BTS station was leased for 103 years from the Catholic Missions. The leasing price was not disclosed.
With a total investment of around 14 billion baht, Mahanakorn will comprise two buildings - one of them claimed to be taller than the 304-metre Baiyoke Tower.
Mr Sorapoj said the conceptual design was done by the international firm Office for Metropolitan Architecture (OMA), which designed the China Central TV headquarters in Beijing.
The usable area would total 150,000 square metres, 60% of which would be leasehold condominium units, branded as the Ritz-Carlton Residences, with around 200 units priced at 250,000 baht per sq m on average.
About 20-25% will be occupied by 150 hotel rooms, operated under Marriott’s new Edition brand, with a target occupancy rate of 75-85% in the first year. Around 15-20% of the area will be retail space. Return on equity is targeted at 20%, he said.
The company will open sales of residential units by the fourth quarter this year and aims to achieve 35% next year and 30% in 2011 and close sales before completion in late 2012.
Pace Development is now developing the Saladaeng Residences luxury condominium, launched early the year and recording sales of 40% to date.
IBC has investments in 18 countries with 1.75 million sq m of property under management. Its turnover last year was US$195 million.
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