by kevinyeo | Dec 17, 2017 | Bangkok Property Market Updates
InterContinental Hotels Group (IHG) is set to debut the Staybridge Suites brand in Thailand in 2019, also a first for Asia-Pacific, hoping to build on the tourism boom.
The group will manage three new hotels, with the first Staybridge Suites Bangkok Thonglor, featuring 303 rooms, expected to open in 2019. The Staybridge Suites Chonburi Siracha is slated to open in 2020 with 400 rooms, while Holiday Inn Suite Sriracha Laemchabang is expected to open later that year.
“The tourism industry in Thailand is continuing to grow, so this is the right time for us to introduce a new brand there and Asia-Pacific,” said Clarence Tan, IHG’s chief operating officer for Southeast Asia and Korea.
Mr Tan said Staybridge Suites was created to meet the needs of extended-stay guests and business travellers, with 250 such hotels across the Americas, Europe and the Middle East and another 151 in the pipeline.
IHG operates 22 properties in Thailand across five brands: InterContinental, Crowne Plaza, Holiday Inn, Holiday Inn Express and Hotel Indigo, with a further 14 hotels on the way.
The three hotels will be developed by a joint venture between SET-listed Origin Property Plc (Ori) and Japan’s Nomura Real Estate Development, with a combined investment of 7.5 billion baht.
Peerapong Jaroon-ek, chief executive of Ori, said the company chose to work with IHG because it has a good track record of operating internationally recognised brands.
“The Staybridge Suites is the right partner for Ori as our company aims to serve long-stay and business travelers in both Bangkok and the east coast of Thailand, where the Eastern Economic Corridor is being pushed by the Thai government,” said Mr Peerapong.
Ori’s five-year plan calls for it to continue investing in and developing projects that generate recurring income, such as hotels and serviced apartments while seeking new channels that offer potential investment opportunities.
To achieve revenue sustainability by 2023, Ori has carefully determined potential developments through a quality selection process managed and operated by a professional operator, he said.
“Our 10 projects in the pipeline, including Staybridge Suite Thonglor and Holiday Inn Suite Siracha Laemchabang, will undergo construction in early January 2018,” said Mr. Peerapong.
Toshihide Tsukasaki, executive officer of residential leasing and hotel management department for Nomura Real Estate Development, said the group will invest up to 19 billion baht in properties abroad over the next five years.
That includes a joint venture project with Ori in Thailand. Nomura is planning to invest in Cambodia, Vietnam, and Myanmar.
“Some 70% of customers at our projects in Thailand will be Japanese, both long stay visitors, and tourists,” said Mr Tsukasaki.
by kevinyeo | Dec 17, 2017 | Bangkok Property Market Updates
TCC Assets has announced the construction of The Parq, a 20-billion-baht mixed-use development that is expected to highlight the role of Queen Sirikit National Convention Centre (QSNCC) as a commercial district.
The building will cover 24 rai, including premium office space integrated with retail zones, restaurants and a hospitality component.
Construction has commenced and the first phase of The Parq, comprising office and retail space, will open in the second half of 2019. The entire project will be completed in 2023.
The property has been leased from the Crown Property Bureau for 30 years with an option to renew for another 30.
The Parq’s first phase of development totals 71,000 square meters of net leasable area, including 60,000 sq m of premium office space.
Premium retail space will occupy 11,000 sq m of the property and will include restaurants, a supermarket and a food court under the “Eat Well and Shop Well” concept.
The Parq’s second phase includes additional premium office space and a hospitality component that will primarily cater to business people and those attending conventions and conferences at the nearby QSNCC.
TCC Assets said The Parq aims to be the first development in Thailand to be both LEED Gold and WELL-certified.
The project will supplement surrounding developments to strengthen the reputation of QSNCC as the largest Mice hub in downtown Bangkok, as well as a new commercial district with direct access to Benjakitti Park.
The Parq is being developed by TCC Assets in collaboration with Frasers Property Holdings Thailand Co Ltd, which serves as the project’s development manager. Frasers Property is the international property brand of Frasers Centrepoint Limited.
“The Parq is conveniently interconnected to retail zones, restaurants and hospitality components. The office space offers the largest floor plate of any commercial office in Bangkok, which is also column-free. It also enjoys direct access to the QSNCC MRT station,” said Panot Sirivadhanabhakdi, director of TCC Assets.
Palmer & Turner was brought on as the architectural firm and PIA Interior has been tasked with interior design. Mr Panot said the project has over 7,000 sq m of green and open areas, designed by landscape architecture firm Shma.
Landscaped gardens will span over 200m along the length of the property frontage on Rama IV and Ratchadapisek roads. The project will be centered around a 3,400 sq m open-air rooftop garden. Additional green areas will be integrated throughout the development.
“Health is the new wealth, with both firms and employees placing a higher value on physical and mental wellness to improve productivity and retention of talent in the workplace. We are developing workspaces that will allow corporations to create healthy work environments for their employees, which will be enhanced by the proximity of 450-rai Benjakitti Park,” said Mr Panot.
Su Lin Soon, chief executive for development of The Parq, said: “Our column-free floor plate, the largest of any commercial office in Bangkok, will meet the ongoing trend of companies wanting to consolidate their operations on a single floor for better internal communications and more collaborative workspaces.”
The floor plates are designed to maximise natural light penetration, she said.
by kevinyeo | Dec 10, 2017 | Bangkok Property Market Updates
SET-listed property firm Singha Estate Plc will collaborate with Hong Kong Land to develop a luxury low-rise condominium worth 2 billion baht on Sukhumvit Soi 43.
The development, scheduled to be launched in the middle of next year, is the second joint venture between the companies.
Singha Estate chief financial officer Methee Vinichbutr said the Hong Kong-based developer is bullish on property investment and development in Thailand. Singha Estate and Hong Kong Land plan to launch at least one joint venture condo project a year.
“Hong Kong Land is eager to invest in the Thai property market and has expressed interested in locations in the central business district and on Sukhumvit Road between the Asok and Thong Lor areas,” Mr Methee said yesterday.
Singha Estate in August this year acquired a two-rai plot on Sukhumvit Soi 43 near Le Dix Palace for an undisclosed price. It plans to develop an eight-story luxury condo with prices of 250,000-260,000 baht per square meter.
Surachet Kongcheep, director of the research department at property consultant Colliers International Thailand, said land prices on Sukhumvit Soi 43 are estimated at more than 1.3 million baht per sq wah.
“Locations from the Asok intersection to the Thong Lor and Ekamai areas will be the hottest over the next few years, as there will be around 10,000 new condo units from at least 10 new projects in the pipeline,” Mr. Surachet said.
The usual amount of condo supply launched in these locations, which span four SkyTrain stations, is 2,000-3,000 units a year, he said.
The unit price for the new condo supply is estimated to be more than 200,000 baht per sqm, while land prices on the main Sukhumvit Road between Asok and Ekamai are higher than 1.7 million baht per square wah, Mr Surachet said.
Mr Methee of Singha Estate said the company will likely shift to developing a low-rise condo project, instead of a high-rise one, because land plots on the main road in potential locations for luxury condo development have become rarer.
“We don’t think the new condo project on Sukhumvit Soi 43 we plan to launch will cannibalize The Esse Sukhumvit 36, a luxury condo project we launched last month, as they are targeted at different groups,” he said.
The Sukhumvit 43 site is near Phrom Phong station, while the Sukhumvit 36 project is near Thong Lor station. The latter is the first joint project with Hong Kong Land and will be a high-rise building with 43 stories.
The Esse Sukhumvit 36 is worth 6.5 billion baht, comprising 338 units priced at 330,000 baht per sq m, of which 30% have been sold. Singha Estate aims to have 50% sold by the end of the year.
In 2018, the developer plans to launch at least two new luxury condo projects worth a combined 7 billion baht. One will be the Sukhumvit 43 project and the other will be a high-rise worth 5 billion baht, for which it is seeking a plot.
Singha Estate aims to have 6 billion baht in revenue in 2018, an increase of 50% from 4 billion baht it expects this year. Up to 70% of total revenue will stem from residential development projects, up from 60% this year.
One-fourth of revenue will be generated by hotels and the rest from commercial properties such as office and retail space.
Mr. Methee said a plan to acquire a concession to develop a large resort project in the Maldives from Boon Rawd Brewery Co will be delayed to early next year.
by kevinyeo | Dec 10, 2017 | Bangkok Property Market Updates, Developer Watch
Magnolia Quality Development Corporation Ltd (MQDC) is set to invest about 90 billion baht on an ambitious mixed-use and multi-generational lifestyle project that will support a forest ecosystem in the metropolitan area.
Located at Bang Na-Trat Road KM7, The Forestias is slated to open in 2022. It will include residential housing, retail buildings, office buildings, a health centre, an innovation centre, a forest pavilion, community space, a learning centre and an extensive natural ecosystem.
MQDC is a subsidiary of DT Group of Companies (DTGO), a property company owned by the Chearavanont family.
The 300-rai project is a collaboration between MQDC and the group’s global partners. They include architectural master plan consultancy Foster and Partners, EEC Engineering Network, which helped research and develop systems in the buildings based on MQDC’s concepts, Atelier Ten for sustainability systems, ITEC Entertainment for experience and entertainment, Six Senses for hospitality and residential management, and Harvard T H Chan School of Public Health for healthy living and well-being.
Construction is scheduled to begin next year.
Chief executive Visit Malaisirirat said the world is dealing with a deteriorating natural ecosystem, broken families and an ageing society, leading to feelings of isolation and depression. He said MQDC aims to develop real estate projects that offer sustainable, happy living through eco-friendly design, modern innovation and technology.
Kittiphun Ouiyamaphun, the company’s senior vice-president for development of The Forestias, said the flagship project redefines the property industry with its concept of “Imagine Happiness”, with the core focus on nature, families, health and well-being.
Mr Kittiphun said their global partners are experts in their fields. Atelier Ten, for example, has contributed to the research and prevention plan to reduce environmental impact and ensure balance and sustainability through innovations.
The company is also in charge of monitoring and assessing construction and design to make the project a model for other world-class projects.
Atelier Ten is the company behind Singapore’s award-winning architectural attraction Gardens by the Bay.
Mr Visit said earlier last month MQDC plans to launch 10 projects worth over 100 billion baht in Bangkok and beyond next year.
MQDC is also designing the concept for a mixed-use project in Pattaya, which is estimated to have a development value of over 30 billion baht.
The project be a joint venture between three parties under one conglomerate: the Chearavanont family’s Charoen Pokphand Group, MQDC and Chinese partner Shanghai Kinghill Ltd, which has expertise in the retail business.
Shanghai Kinghill is a subsidiary of Chia Tai Group Co Ltd, one of the Chearavanont family’s agricultural businesses. Founded in 2002 and based in Shanghai, it owns and operates an urban shopping centre, Super Brand Mall, in Shanghai.
The Pattaya project will comprise a residential development, hotel and retail space and be located on a 40-rai plot in the Na Jomtien area, which was formerly used by Charoen Pokphand Foods, a CP Group business.
Mr Visit said one of the new projects MQDC plans to launch next year will be a super-luxury condominium worth 8 billion baht, to be situated on a four-rai plot near Lake Ratchada Office Complex on Ratchadaphisek Road, opposite Benjakiti Park.
Of the 10 projects MQDC planned for 2018, six will be developed under the Whizdom brand, together worth over 20 billion baht.
One of them will be Whizdom Chinatown, worth 4 billion baht, which will be a 30-storey condominium with 200 units priced from 200,000 per square metre. The project will be located on a two-rai plot near MRT Hua Lamphong.
by kevinyeo | Dec 10, 2017 | Bangkok Property Market Updates
The new land and buildings tax, which is expected to come into force in January 2019, is pushing landowners to either divest of vacant plots, seek partners to develop their land or hire property consultants to manage their land.
Many wealthy landowners have been thinking about renting, selling or developing their assets, said Ratchaphum Jongpakdee, general manager of property consulting firm Colliers International Thailand.
“A lot of the reviewing is for vacant plots,” he said. “They have been thinking about doing something with them after learning the new tax will be effective from January 2019.”
Some have decided to sell or rent out some of their lands. Most of these plots, situated in prime locations in Bangkok, will be taxed at a high rate under the draft tax because of high appraisal prices.
The draft of the tax bill calls for a rate of 0.05% to be applied to first homes and agricultural land worth between 50 million and 100 million baht, and a 0.1% rate for homes above 100 million.
Land for second homes will be taxed at 0.03-0.1% of its appraisal price. Land for commercial and industrial use will be taxed at 0.3-1.5%.
The tax on vacant land will start at 2% and rise by 0.5 percentage points every three years, until it reaches 5%.
“Some landlords are seeking partners to participate in joint ventures to develop projects on land that has been idle for years,” said Mr. Ratchaphum.
Colliers Thailand is organising an auction for a 524 square wah plot on Sukhumvit Soi 12. The firm targets an 800 million baht price for the property, or around 1.52 million baht per sq w.
According to the Treasury Department, during 2016-2019 land along Sukhumvit Road in Klong Toey district was appraised at 210,000-650,000 baht per sq w. The appraisal value of the Sukhumvit 12 plot tendered by Colliers is 110-340 million baht.
If the land and buildings tax act is effective, this plot will be taxed at 2.2-6.8 million baht a year.
The plot’s owner is open to selling the property or developing it through a joint venture, said Mr. Ratchaphum. “There are two foreign investors bidding for a joint venture with the landowner. The bidding will be finalized within this week,” he added.
The foreign investors include a Malaysian contractor interested in developing a condominium and a Japanese developer that wants to build a hotel, he said.
Many high-net-worth families, with large interests in property, are alarmed by the land and building tax. Among those that have hired Colliers Thailand to manage their plots are the Osathanugrah family and Prasarttong-Osoth families.
The Osathanugrah family’s plots (each sized 1-10 rai) are mostly located along Sukhumvit Road from Bang Chak BTS station to Pak Nam in Samut Prakan. Plots near BTS stations could be developed into condominium projects.
“Ask yourself whether you want to hold that land or not. Everyone has a different answer,” said Suwannee Wattanavekin, executive vice-president of Kiatnakin Bank Plc’s asset management department. “To manage it, you should know its cost, market price, and tax rate. Then you can plan what to do with it.”
A landlord who has owned a one rai plot on Soi Thong Lor for a long time had an effective ownership cost of zero. After the tax is implemented, he or she will need to pay 2% of the land appraisal price (420,000 baht per sq w), or 3.36 million baht a year.
However, the market price for land on Soi Thong Lor is now at least 1.5 million baht per sq w. Land prices in Bangkok’s prime locations are increasing 5-10% per year, according to Colliers.
“Tax ceiling for a vacant plot may be 5% of the land appraisal price, but land prices are increasing more than 5% a year,” said Mrs. Suwannee. “At no cost, it is worth holding the plots, particularly those in prime locations.”
People should not panic over the new tax, she said, but start analyzing their plots’ costs, locations, price increases and potential for development.
Top 10 Highest Appraisals For Land Prices In Bangkok During 2016-2019 (source: Bureau of Property Valuation, Treasury Department)
- Silom Road
- Ploenchit Road
- Ratchadamri Road
- Rama 1 Road
- Wireless Road
- Sathorn Road
- Yaowarat Road
- Sukhumvit Road
- Narathiwat Ratchanakharin Road
- Rama 4 Road
