Townhouses trump condos as hot trend
By admin | July 3, 2009
Townhouses will lead Bangkok’s new residential supply this year as they best fit current purchasing power as an alternative to condominiums, says Samma Kitsin, director-general of the Real Estate Information Center (REIC).
“Due to the sluggish economy, developers have shifted to townhouses as they expect more real demand than from condominiums. One-third of condo purchases are for investment or speculation,” he said.
Developers also believe the condominium market has almost reached maturity, with a glut of units recently completed.
Mr Samma said low-rise development (townhouses or single houses) was still the first choice for the general public,but condominiums had played a larger role the past few years due to rocketing oil prices, as people sought to live closer to their workplaces.
Townhouses are also favoured in a weak economy over single houses.
After freezing townhouse development since the 1997 financial crisis, MK Real Estate Plc plans to resume building them by the third quarter.
The prospective blossoming oftownhouses in Bangkok can be seen by the number of land allotment permits during the first quarter.
According to the Lands Department,there were 22 permits in the quarter for 3,678 units. Of the total,66% were townhouses (2,429 units), followed by single houses (760 or 20.7%), land plots (215 or 5.8%), duplex houses (180 or 4.9%) and buildings or shophouses with 94(2.6%).
The 22 permits were held by 18 different developers, including Preuksa Real Estate, Land & Houses, Sansiri and Noble Development with two each.
From the figures, Mr Samma forecasts that townhouses will dominate Bangkok’s residential market from the second half of 2009 until the first half of 2010.
He said many new transport networks such as the outer ring road and expressways opened fresh locations for townhouses. Lower fuel prices, down 35% from a peak in mid-2008, mean travel cost is less of a deterrent for buyers.
“New roads will trigger medium- to lower-priced townhouses while [locations near] BTS and MRT stations will be for high-priced townhouses,” he said.
Land allotment permits from the first quarter suggest the hottest locations were Bang Khun Thien with 442 units from a local developer, Praves with 408 units from Noble, Nong Khaem with 368 units from PS and a local developer, Don Mueang with 365 units from PS and a local developer, and Min Buri with 351 units from two local developers.
http://www.bangkokpost.com/business/economics/18932/townhouses-trump-condos-as-hot-trend
Townhouses trump condos as hot trend
Source - Bangkok Post
June 22, 2009
By KANANA KATHARANGSIPORN
Bangkok facing glut of apartments
By admin | July 3, 2009
Supply builds as ongoing recession begins dragging tenancies down
Thailand’s residential-leasing market is suffering from oversupply following the downsizing or closure of local operations by multinational firms in the face of the economic downturn, says real-estate services firm Colliers International Thailand.
As a result, most property developers who are building apartments and serviced apartments have slowed their construction to delay the completion of their projects until next year, managing director Patima Jeerapaet said yesterday.
Arnuj Rittichaiseri, associate director of Colliers’ Residential Department, said many expats had been asked to lower their accommodation costs, and this had placed downward pressure on the upscale market. However, more affordable apartments in the middle market could benefit in the short term.
Many multinational companies are downsizing or closing local operations, or are planning to do so, in both the manufacturing and services sectors. The key Japanese market could be particularly badly affected by these developments, with a strong impact on the core Sukhumvit apartment market, she said.
The increasing number of new serviced apartments coming on to a market already hit by economic conditions will increase competition in the Sukhumvit area.
In the first quarter, 1,496 new expats arrived in Bangkok. However, the number of new work permits is expected to decline this year, and apartment occupancy rates in the first quarter fell to 73.1 per cent, 17.07 per cent below the peak in 2005, according to the company’s head of research and advisory, Risinee Sarikaputra.
Slowing demand has pushed the average rental rate for grade-A serviced apartments down 4 per cent, from Bt1,256 per square metre per month to Bt1,210.
Average rental for grade-B serviced apartments fell 2 per cent in the first quarter, from Bt898 per square metre to Bt881.
Throughout this year, average rental per square metre is expected to fall 10 per cent for grade-B serviced apartments and 15 per cent for grade A.
Arnuj said the Bangkok apartment market appeared to be faring reasonably well towards the end of last year but that the first signs of a downturn were becoming evident then.
Despite the prospect of mounting job losses, it is reassuring that the Bangkok apartment market remains buoyant despite the move by some expats to cheaper accommodation. The present world economy - especially the weakness of the pound and several other currencies - is having an impact on accommodation budgets, and the turnover of people moving to lower their rent is noticeable, she said.
However, overall occupancy of apartments is high, with an average of 90.89 per cent at the end of last year. Grade-A occupancy was then 90.89 per cent and grade B 90.88 per cent.
Contrary to what might be expected, landlords were generally not giving deep discounts at the end of last year, because they were not yet feeling the pinch; the number of people moving out had not risen significantly. The average rental rate in the Bangkok expat-apartment market was Bt349 per square metre per month. The average rate for grade-A apartments was Bt457 per square metre per month and for grade B, Bt303, Risinee said.
New-apartment supply grew 5.6 per cent per year between 2003 and last year, whereas growth in the supply of serviced apartments this year is expected to be 23.4 per cent, a very sharp increase which will make this year a particularly challenging one for the industry, she said.
Colliers said Bangkok’s apartment market [as distinct from serviced apartments] now had a total supply of 10,643 units. Of these 3,536 units, or 33 per cent, were grade-A apartments, and the remaining 67 per cent, or 7,107 units, were grade B.
New apartments expected to be completed next year will add 1,166 units.
Agency research showed the occupancy rate of grade-A apartments in the Sukhumvit Road area stood at 91.42 per cent at the end of last year, while 91.25 per cent of grade-B apartments in the same area were occupied.
Rental of grade-A apartments in the Sukhumvit area averaged Bt442 per square metre per month. This price saw the area ranked third after the Lumpini area and the central business district, including Phloenchit, Rama IV and Wireless roads. Average grade-A apartment rentals in these areas were Bt509 and Bt469 per square metre per month, respectively.
Despite high occupancy at the end of last year, prospects for this year appear less bright as local units of multinational firms face possible downsizing or closure, with the high-end and Japanese markets expected to show the first signs of weakness, the research said.
The agency’s research found Bangkok’s serviced-apartment market offered 12,722 units in 89 buildings at the end of last year, up 15 per cent from 2007. Nearly half of the supply at the end of last year, or 6,345 units, was located in the Sukhumvit area. Of these, 1,729 units were grade-A serviced apartments and the rest grade B.
New supply of serviced apartments, reaching the market between the start of this year and 2011, is expected to total 5,923 units. Most of these - 3,401 units - will be added to the market this year, the research said.
The percentage of customers staying long term (more than one month) stood at about 47 per cent of total demand last year. The main source of demand (53 per cent) came from the short-stay tourist and business markets, renting on a daily or weekly basis.
Colliers pointed out serviced apartments were increasingly competing head to head with the hotel sector.
Occupancy rates last year fell in both grade-A and -B serviced apartments, to 78.38 per cent and 77.35 per cent, respectively.
The average rental rate remained stable for grade A last year, at Bt1,256 per square metre per month, while the average rate for grade-B serviced apartments rose slightly, to Bt898 per square metre per month.
The research said serviced apartments recorded a drop in both occupancy and average rental rates in the first half of the year as the world economy continued to decline.
Some forecasts envisage first-half tourist arrivals in Bangkok falling 20-30 per cent, especially leisure groups, it said.
Bangkok facing glut of apartments
By Somluck Srimalee
The Nation
June 25, 2009
LOCATION, LOCATION, LOCATION
By admin | June 18, 2009
The highs and lows, ups and downs of the Bangkok property market
Although the property market is very dull right now the malaise is not expected to continue much longer because it actually bottomed out last month with sales picking up after almost halting completely in April, says Aliwassa Pathnadabutr, managing director of CB Richard Ellis (Thailand).
The reason transactions started taking place in May is because sellers cut their prices to levels more in tune with what buyers have in mind after the Songkran unrest.
While this is encouraging, Ms Aliwassa has noticed that substantial amount of new supply has been put on the back burner with demand too having slumped. It is now very visible that foreign buyers are no longer active here with up to 80 to 90% of them having dropped off.
Fortunately locals are still buying both for their own use and investment after previously sitting on the sidelines to see how low prices would plunge. However the market turned after the Songkran upheaval because sellers decided to forgo the substantial profits they earlier had in mind.
The mark down depends on the original cost of the individual buyers but generally this is in the range of 15 to 20%. Pertinent example is the luxury condominium category with units that change hands easily in Sukhumvit area costing around 100,000 to 115,000 baht a square metre which is much lower than around 140,000 baht a square metre previously.
Another major change is that buyers have lowered their expectations where size of unit is concerned because a lot of people are less flush these days. A two-bedroom unit of around 90 to 100 square metres carrying a lighter price tag would sell well in these shaky times.
Ms Aliwassa added that it is difficult to sell very large 300- to 400-square-metre units because this is really a niche market with those who can afford to buy them being billionaires who used to live in a big house and have now chosen to move into an equally large condominium.
In general, three-bedroom units of around 140 to 160 square metres with good layout would sell briskly. Slightly more lavish three bedroom units of around 200 square metres with all the facilities in place including a maid’s room are also faring well.
While workers and families seeking a second home are still on buying 30- to 40-square-metre condominium units near train stations, some of them who previously considered buying two one-bedroom units with future needs in mind are now opting to buy only one of them.
“While one-bedroom units sell well because the price is not too high, in reality a twobedroom unit is something practical and is what people want the most, but it depends on whether they can afford it or not.”
The unit size is also important when it comes to renting them out with Ms Aliwassa pointing out that a two-bedroom condominium around 80 to 100 square metres would attract tenants because anything smaller would be a squeeze with this affecting the rent.
Likewise a one-bedroom unit should be around 50 to 60 square metres because any-thing smaller will lead to potential tenants feeling that the rent is too high.
A three-bedroom unit should be adequate for a family to live in without feeling squeezed with a good size being 150 to 160 square metres.
Also it does not matter whether a building is new or old because tenants focus on the location and facilities. As always, good decor definitely lifts the value of a unit.
While expatriate families generally opt for big units in good locations, investors have to beware that they might get lower return if they buy too big a unit in a new building because expatriate rental budget is generally 80,000 to 90,000 baht a month and at best 100,000 to 120,000 baht a month.
“We don’t have to be very luxurious and can just dabble in the general market.”
While the Japanese continue to favour the zone they have carved out in Sukhumvit which is sois 31,33,39 and 49 up to Thong Lor on the odd-numbered side and sois 24 and 26 on the south side, other nationalities do not have such preferences and are willing to live anywhere from Soi 1 up to Ekamai.However, they do tend to choose buildings where their own communities are housed.
It is very noticeable that the first few sois of Sukhumvit up to the Asok junction have changed and turned into an entertainment and tourist area. Ms Aliwassa observed that while apartments in this area are still renting,a lot of families have opted to move farther down from there. However, this zone continues to be popular with singles who find it very convenient to live in especially where food is concerned because they can get everything from the cheapest to the most expensive within walking distance.
With the global economic picture still so cloudy, there are currently a lot of distressed sales. To meet this need CBRE has started a “hot deals” category on its website and properties highlighted in this slot do sell steadily.
“If it is posted as a hot deal for a week or up to a month it will be sold but it has to be a really hot deal,” she said.”We do select [properties] and it’s not that something is not hot but we make it hot.”
Another good market is the resale of condominium contracts because this year as many as 9,800 units are being completed, a total that’s expected to drop to around 2,000 to 3,000 units in the following years. As transfers approach some of the buyers might think it is too risky to go through with the deal or might not want to part with any more money just yet and decide the sell these contracts at cost without making any profit with this being a win-win situation for both parties.
While everyone is hoping that the second half of the year will be better than the first six months, Ms Aliwassa thinks even if the situation does improve property prices will not rise but the better environment would spur demand and increase trading activity.
However if political tensions heat up again it will sap confidence once more leading to a reluctance to spend money even if people could afford to do so.
“Politics is the key issue because everyone knows the economy has reached the bottom.”
Source - www.bangkokpost.com
Published: 14/06/2009 at 12:00 AM
Newspaper section: Business
By Nina Suebsukcharoen
http://www.bangkokpost.com/business/economics/18443/location-location-location
PROPERTY SCENE: FUTURE TRENDS IN BUYING LUXURY PROPERTY
By admin | June 18, 2009
Source - The Nation Website
Contributor: ALIWASSA PATHNADABUTR
MANAGING DIRECTOR OF CB RICHARD ELLIS THAILAND
More and more wealthy people in Bangkok are shifting from living in a house to a condominium. We have seen many condominiums launched over the past five years, but how many of them match the top-end buyers who are end-users and wish to occupy the condominium as their main home? CB Richard Ellis believes that there are only a limited number of developments that really match the needs of high-end owner occupiers. Buying a luxury home is no longer just a matter of looking at the design and quality. Design is a subjective issue reflecting the individual style and preference of the buyer. Ultimately, the trend is for something simple, with style and high quality. Developers, therefore, should return to offering what buyers really want rather than always trying to create something new in the market. The search for a unique design often results in a niche product that appeals to a small group of people or a design, which may not be practical or functional.
In the luxury market, apart from the issue of location, good quality and design, which are still the main criteria; we are noting changes in demand for luxury property to include other factors.
People are increasingly seeking well-being and a good quality of life. There is a trend towards living closer to nature even in the city where many high-rise buildings block the views from the windows. While green areas are very rare in cities, condominiums having open views overlooking greenery are always the most popular among luxury property buyers.
Residential property, including villas and condominiums, managed by branded hotels or serviced apartments is another trend among the rich. The reason behind this is the high standard of management and services. The standard of management ensures that the asset value will be enhanced in future, a factor that is particularly sought after by those who buy for investment purposes.
Simply branding a property is not sufficient, there need to be a range of services offered by the hotel or serviced apartment operator.
In the current market, condominiums usually do not provide services. The building will be managed by the juristic person or a management company appointed by the juristic person. The services provided are only in the common areas and include maintenance, security and the upkeep of facilities.
The cost of providing additional services will be reflected in the higher common area management fees which have to be absorbed by the buyers. This is not objected to by the top tier buyers who realize that there has to be an additional cost higher than the normal rate of common area management fees.
Condominiums that are managed by hotels or serviced apartments and offering services such as cleaning, laundry, room service, limousine and a concierge service are increasingly in demand at the top-end of the market.
The mixture of very small units and large units is also of concern to buyers in the upper segments, who tend to prefer to live in an exclusive environment with similar types and sizes of units; in other words, they prefer to live among the neighbors with a similar level of wealth. The marketability of such projects during the development period may not be ideal for developers because units with a higher total price sell at a slower rate. To achieve the certain requirement on percentage of sale, there is usually a mixture of several unit types from one to three bedrooms in these projects. That is why there are very few luxury buildings that will match demand in the top segment of the market.
No witch-hunt, says Lands Department
By admin | June 18, 2009
Foreign ownership debate intensifies
“We have some regulations and processes to investigate illegality, but not that many. We must respect individual rights and assume individuals will not give fake statements to officials Anuwat Maytheewibulwut Director-general, lands department
The Lands Department does not have a policy to scrutinise acquisitions in which illegal use of Thai nominees on behalf of foreigners is suspected, says Director General Anuwat Maytheewibulwut.
Land ownership revocation cases mostly occur when a complaint or conflict is brought to the department’s attention, he said.
“Each year there are 5.5 million land related transactions handled by the department and we receive around 1,000 complaints,” he said.”We have no time to check every transaction, but we will investigate when there’s a complaint.”
Mr Anuwat was responding after several sharp letters in the Bangkok Post over the past two weeks from readers who questioned the department’s policy on land acquisition by foreigners. Some alleged it was xenophobic.
He said it was likely a misunderstanding that the department would scrutinise every transaction suspected to have a Thai nominee owning land for foreigners. In fact, an investigation will be initiated only if there is a complaint.
“There is nothing new in the Land Code for land acquisition by foreigners, “he added.
“For purchases or transfers, we have some regulations and processes to investigate illegality, but not that many. We must respect individual rights and assume individuals will not give fake statements to officials.”
According to the Land Code, a foreigner can legally acquire land by inheritance as a legal heir, and his or her land ownership must be approved by the Interior Ministry.
Alternatively, a foreigner must invest at least 40 million baht and maintain it for five years through investment in Thai government bonds, property mutual funds, or in share capital of a Board of Investment-promoted company.
Under these two criteria, a foreigner can purchase up to one rai of land for residential use. The department also allows foreign ownership up to 49% of saleable space in a condominium, said Mr Anuwat.
If a foreigner has a Thai spouse, either legitimate or common-law, and wants to buy land, the Thai spouse must give officials of the Lands Department a joint written confirmation that the money for the purchase is wholly separate prop-erty or the personal property of the Thai spouse, not jointly acquired property.
“If a foreigner has a conflict with his or her Thai spouse and makes a complaint on land ownership to the department, we will investigate,” said Mr Anuwat.”If we find the ownership is illegal, we will ask them to transfer or sell that piece of land within 180 to 365 days.”
If the transfer or sale cannot be made within a year, the department will use its authority to do it. Any legal dispute between the couple not involving land ownership must be resolved under civil law.
“Changing foreign land acquisition regulations such as an extension of the leasehold period to longer than 30 years or increasing foreigners’ quotas to buy condominiums is a government matter.The department is always ready to carry out the government’s policy,” Mr Anuwat said.
He added that all foreigners who comply with the law will get full protection under the law.
“For anyone involved in land ownership on behalf of foreigners, what they should be sure of is concern for the nation, ethics and morality in applying the law to make sure they are good Thai citizens,” he said.
Source - www.bangkokpost.com
Published: 15/06/2009 at 12:00 AM
Newspaper section: Business
By KANANA KATHARANGSIPORN
http://www.bangkokpost.com/business/economics/18514/no-witch-hunt-says-lands-department
Everyone wants a bargain
By admin | June 5, 2009
Source - Bangkok Post
May 29, 2009
By Nina Suebsukcharoen
In today’s buyers’ and tenants’ market, companies push for lower rents and condo buyers snap up dwindling supply.
The fallout from the global economic crisis and local political strife is being felt in both the office and residential real estate markets. Struggling companies are pushing for reduced rents,while the supply of residential units fell by as much as 30% in the first quarter,says Apisit Limlomwongse, managing director of Nexus Property Consultants.
The first quarter was marked by a rise in renegotiations to reduce office rents by 10-15% as companies struggled to preserve their bottom lines during the downturn.
One win-win deal for both parties is to reduce rents over the next 12 months,gradually increasing them to their previous levels in the second and third years of the usual three-year contract term,said Mr Apisit.
“There is a definite reduction in demand and landlords should realise they have to cope with this.”
So far, companies have not tried to cut costs by moving to cheaper buildings as they did during the 1997 Asian financial crisis, he said. Back then there was a gap of almost 50% between rents in Grade A and Grade B buildings, from 500-900 baht per square metre to around 400-500.
Today’s rents do not differ substantially for buildings in the same zone regardless of grade. Only those companies shifting completely out of the central business district (CBD) are able to make meaningful savings.
But if the situation deteriorates further by the year’s end a number of firms will be forced to downsize.
Mr Apisit also cautions that the full extent of the impact of the global economic slump on the Thai and Asian economies has yet to be seen, as the region initially seemed to bear the brunt better than the West.
“Many companies we talk to say Europe and America might be looking bad, but Asia’s office rental market is still strong. There is still growth here,but it is uncertain whether earnings here can offset losses there.”
Although office rents are sliding, he said the sector’s fundamentals remain sound, because there is minimal new supply in the pipeline while comfortable occupancy rates of about 90% have been achieved over the past few years.
Research by Nexus shows the supply of new residential condominium units fell by as much as 30% in the first quarter.This decreased from about 30,000 units in 2007 to about 20,000 units in 2008.This year’s new supply is expected to be around 14,000 units.”This figure is quite good because it will help demand catch up somewhat. More than this would be detrimental because buyer sentiment is not that good.”
While there is hope for a turnaround in 2010, the market still has to navigate troubled waters this year to overcome the first quarter’s drop in condo sales.
Current buyers are mainly end-users who are only buying units in projects they are certain will be completed within the next 12 months. Investors have almost disappeared from the scene.
One-bedroom units of 40-50 square metres costing around 70,000 to 80,000 baht per square metre, or a total of 3-4 million baht, are the most popular. Another group of buyers that is emerging are people who are buying to occupy in the short term with aim of renting out their properties in the medium to long term. They are mostly buying units in buildings that are completed, or are close to completion, said Mr Apisit.
The resale market is less affected than the primary one because most people in this segment are buying to occupy and generally plan to move in within three months to one year. There are a lot of products available for resale and it is now easier for owners to sell property via the internet, he said.
Some foreign investors have panicked and are trying to cash out, but there is another group of professional investors who are picking up the units being sold cheaply.
“It’s similar to the stock market -when it dips there is one group selling and another buying,” he said.
Buyers can work out if a condominium’s price is cheap by assessing its gross rental yield - a percentage of the annual rent divided by the cost of the property. The current market average is 6%. If the buyer can get 8% then it can be considered to be a good deal, said Mr Apisit.
Some developers are unlikely to complete their projects given the current shaky market conditions, he said.
However, construction quality should be less of a concern because of the lower cost of raw materials such as steel. It is also much easier to negotiate with contractors due to the limited demand in the market.
Condominium developers have, in recent years, mostly built projects along the skytrain and subway lines. Singledetached-house (SDH) estates prioritise being near developed communities with good facilities, such as hospitals and shopping malls.
Mr Apisit said estates with houses priced from 4-6 million baht that are within 15-20 kilometres of the city centre are selling the best. Demand for houses has revived as oil prices have eased, as commuting costs are a major factor in home buyers’ decisions.
Industry’s Quick Overview
By admin | June 5, 2009
The Thailand’s real estate industry at present has been dominated by the top 8 companies which occupy more than the 60% of total market share or approximately 120,000 Million Baht from the total market cap of 200,000 Million Baht. Strong balance sheets and excellent cash positions are now allowing those top companies to purchase development land at great prices.
Recently, several top companies, including Land & Houses, Preuksa, Sansiri, Asian Property Development, LPN and Property Perfect revealed to the public that they have set aside more than 10 Billion Baht to buy undeveloped land in the greater Bangkok area in the second half of the year.
Most top companies tend to raise the huge fund through issuing the debenture with the attractive rate of annual interest. The funds will be mostly used for working capital and for buying land. In this year, the above companies have together issued the debentures for more than 20,000 Million Baht. Meanwhile, the small and medium real estate firms have to face the problem of lacking working capital from the financial institution and they can’t issue the debentures as well. Those companies, hence, eventually force themselves to business merging or business exit.
In terms of resale housing, the economic crisis has inevitably delivered the negative effect to the industry as it influences to the capability of debt payment for many house owners so that they finally decide to sale their houses. Statistically, the amount of 60,000 – 70,000 resale housing units will be enter to the market each year. But up to now the amount of resale houses in the industry has been reached its height to more than 200,000 units or approximately 450,000 Million Baht and it has been expected more likely to come within the second half of this year. In contrary, the demand is likely to continue shortage in which it has been recorded for 30% dropped on sale volume in comparison to the last quarter of the previous year.
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.
AP raises 2009 target by 10%
By admin | June 5, 2009
Source - Bangkok Post Website
May 25, 2009
CEO: Sentiment begins to improve
Listed developer Asian Property Development Plc (AP) has raised its 2009 revenue target by 10% and will launch 12 projects worth a total of 21.27 billion baht by the first quarter of 2010.
Market sentiment improved in May, despite the riots in mid-April, said CEO Anuphong Assavabhokhin. Surprisingly, the number of customers visiting project sites did not fall in the first week following the protests, he added.
“We didn’t dare launch new projects in the first two months, as the market had been bad since late last year,” he said.
“Now until the first quarter next year, AP will launch new projects each month - seven condominium projects worth 13.9 billion baht and five low-rise projects worth 7.37 billion.”
With the improved outlook, AP is aiming for 10 billion baht in revenue by the year-end, 10% higher than a previous target of 8.5-9 billion baht.
But Mr Anuphong said revenues could fall by as much as 10% from its earlier target if the market deteriorates and risks from the US and from Thailand’s economy and political situation flare anew.
“The positive outlook is really limited only for large developers, which are advantaged and tend to expand market share. They have stronger financial status and get better offers from banks. The market today rarely opens for small and medium-sized developers,” he said.
Competition in the financial markets has increased, he said. But, while many banks are offering better conditions, some developers - mainly small and medium-sized companies - have found it harder to get project loans and mortgages loans for their customers.
The financial statements of many large developers improved substantially in the first quarter from the fourth quarter last year, said Mr Anuphong.
AP’s sales doubled on the same period last year to 2.8 billion baht with net profit up 217% to 481 million. Gross margin was 34% while pre-sales from January to May 18 were 2.5 billion baht.
Chief marketing officer Visanu Suchatlumpong said only large developers would remain in the market. But he forecast that employees’ skills would replace funding as the key to success. Developers with teams that are quicker to adapt and more dynamic in catching market trends will perform better.
“Mid- and smaller-sized developers have obstacles in business expansion,” he said.
“They need to change implementation, management and internal process. To grow, diversification in product segmentation and location is a must.”
AP has a budget of 4 billion baht for buying land plots and has already spent 700 million baht in the first four months. Despite this aggressive plan, though, it will aim to maintain its debt to equity ratio at not more than one time.
To date, AP has a sales backlog of 11.8 billion baht, of which 9.6 billion is from condominiums and 4 billion will be realised this year.
Shares of AP closed at 3.90 baht yesterday, up 18 satang, in trade worth 172.49 million baht.
The ADDRESS Chidlom **Available Now** @ BKKCitiSmart.com
By admin | March 20, 2009
We are please to announce a Luxury Project at soi. Somkid by AP. Get this opportunity to own the last project on this area. Please visit The Address Chidlom Page for more information.
