Bangkok - New heights achieved in property sector

Locals and foreigners continue to develop in Bangkok

Despite uneven growth in the property sector, 2017 recorded the largest investments in new property development projects, totalling over 300 billion baht from both local and foreign investors.

The biggest investment was from TCC Group, owned by billionaire Charoen Sirivadhanabhakdi, spending more than 120 billion baht to develop One Bangkok, a mixed-use project on a 104-rai plot at the corner of Wireless and Rama IV roads.

With a total gross floor area of 1.83 million square metres, the project will comprise five Grade A office towers with a combined lettable area of 500,000 square metres, five luxury hotels with about 1,000 rooms, three ultra-luxury residential towers, retail space, a 10,000-sq-m plaza for activities, arts and culture, and a promenade.

The entire project is scheduled for completion in 2025.

TCC also announced construction of The Parq, a mixed-use project worth 20 billion baht on a 24-rai site at the Klong Toey intersection on Rama IV Road near Queen Sirikit National Convention Center.

It will have a lettable office space of 60,000 sq m, retail area of 11,000 sq m, restaurants and a hospitality component. The office and retail areas will be completed in 2019 and the rest in 2023.

Both One Bangkok and The Parq are joint ventures between TCC Assets Thailand Co, one of TCC Group's subsidiaries, and Frasers Property Holdings Thailand Co, a wholly owned subsidiary of Singapore-based property firm Frasers Centrepoint Limited, chaired by Mr Charoen.

"We aim to enhance global confidence in Thailand as a Southeast Asian hub and a key gateway and lifestyle destination in Asia," Mr Charoen said at an opening event for One Bangkok last April.

The second-largest investment was announced by Hydoo Best Group Co, a joint venture firm of Chinese developer Hydoo International Holding Ltd, Thailand's Best Group Ltd and private equity group W Ventures Hong Kong.

They will develop the Trust City World Exhibition and Trade Centre, worth over 100 billion baht, which will include 2.5 million sq m of retail space, convention halls, hotels and serviced apartments on Bang Na-Trat Road.

Another Chinese developer announcing a property investment in Thailand was Country Garden. One of the largest developers in China, the firm is based in Guangdong and has developed township projects in Malaysia and Australia.

In mid-2017, the Chinese developer's subsidiary Beauty Honour Enterprises Ltd signed a joint venture agreement with Crown Development Co, a subsidiary of SET-listed industrial estate developer Thai Factory Development Plc.

They plan to develop a condo project worth 6.8 billion baht with four 34-storey buildings and a total of 1,337 units on an eight-rai site on Ratchadaphisek Road, the most popular location among Chinese.

The country whose property developers were the most active investors in Thailand in 2017 was Japan, with four Japanese developers signing joint venture agreements with four Thai developers.

The eight Japanese and Thai developers are committed to developing residential projects worth more than 56 billion baht combined.

The biggest co-investment is by Japan's Sumitomo Forestry Co and SET-listed developer Property Perfect Plc. They plan to develop both condominium and single-house projects worth a combined 40 billion baht within 2021.

Another partnership with potential to develop large-scale projects is that of SET-listed developer Sansiri Plc and Tokyu Corporation, as the latter specialises in the development and operation of railway networks on the peripheries of Tokyo, urban and real-property development, hospitality businesses and many other operations.

Sansiri and Tokyu Corp are interested in developing a township project in the next few years after agreeing in 2017 to build their first joint venture, an eight-storey condominium project worth 2 billion baht on Sukhumvit Soi 63 (Ekamai).

Other Japanese developers entering the Thai property market include Nomura Real Estate Development Group and Hoosiers Holdings.

Nomura has entered a joint venture with SET-listed developer Origin Property Plc to develop condominium projects worth a combined 8.6 billion baht in 2017-18.

Meanwhile, Hoosiers joined with medium-sized developer All Inspire Development Co to develop condominium projects worth a combined 6 billion baht.

There are also two investors from Hong Kong with a strong interest in the Bangkok condo market.

One is Hong Kong Land, a large property investment management and development group, which has formed a joint venture development in a condo project worth 6 billion baht near Sukhumvit Soi 36 with SET-listed property firm Singha Estate Plc.

The other is eyewear maker Wah Ming Optical Manufactory Ltd, which has formed a joint venture with Thai investor 888 Thonglor Co to develop a low-rise condo project worth 1.6 billion baht on Thong Lor Soi 23.

"There will be more foreign investors working with local developers and investors as Bangkok's property market is one of the most attractive destinations for overseas investors," a source said.