Bang Sue Area Plans Being Formed To Lure Investment

Bang Sue Area Plans Being Formed To Lure Investment

The government is being urged to promote the establishment of an urban development corporation, amend some city zone regulations and extend the period of leasehold contracts to make developments surrounding Bang Sue station more attractive for investment.

Atip Bijanonda, chairman of the committee for real estate development at the Thai Chamber of Commerce, said the development plan for areas surrounding the station is very attractive.

“The greatest benefits will be within a five-kilometer radius of the station. These locations will be the cream of the crop,” he said.

But the State Railway of Thailand (SRT) should not develop the area in a piecemeal fashion, but rather the entire zone all at once to make it more attractive for investment said Mr. Atip.

The SRT said development of the Bang Sue station and surrounding areas will cover plots totaling 2,325 rai.

On 200 rai, SRT is building the central station, where three existing mass transit lines — Green, Blue, and Purple — will connect with the Red Line, which will be added on completion in 2019. Over the next 15 years, there will be 10 mass transit lines connected at the station.

The remaining plots are planned for property development into four zones, comprising zone A on 35 rai on the south of the central station, which will be developed as a transport hub.

Transport Minister Arkhom Termpittaya-paisith yesterday said the terms of reference for the public-private partnership scheme for the development of the first zone or zone A is being drafted and will be completed in four months.

Deputy governor Worawut Mala said the SRT will seek a developer through bidding to develop commercial spaces in zone A as SRT had no experience or know-how in large-scale commercial development.

“We have only done fresh markets,” he said. “In one of the four zones, a Japanese adviser suggested we open a convention center to attract related businesses.”

Mr Atip, also president of the Housing Business Association, said the government should support the establishment of an urban development corporation (UDC) to host the development of areas surrounding Bang Sue station.

“Many overseas countries have established UDCs to develop large-scale projects, such as the Docklands in London. UDC will develop utilities and allow other investors to develop the property,” he said.

He suggested an amendment in the city zone regulations to limit the maximum parking space for commercial development in areas surrounding stations to force travelers to use mass transit lines instead of personal cars.

The city zoning laws require specified numbers of car park spaces at large-scale buildings.

As the plots surrounding Bang Sue station are owned by SRT, a leasehold contract period should be extended for over 30 years to make investments more attractive, said Mr Atip.

 

source: https://property.bangkokpost.com/news/1461769/bang-sue-area-plans-being-formed-to-lure-investment

Japanese Real Estate Firms Are Penetrating The Thai Property Market

Japanese Real Estate Firms Are Penetrating The Thai Property Market

Successive Japanese real estate firms are penetrating the Thai property market by joining forces with local partners to cash in on growing demand for residences.

Tokyo Tatemono Co, one of the major developers in the Tokyo metropolitan area, is the latest entrant into Southeast Asia’s second-largest economy as condominium supply swells in Bangkok.

The company recently signed a joint venture agreement with Raimon Land Public Co to implement a 9.1-billion-baht project for the development of two high-rise condo complexes, one in Sathon and the other in Phrom Phong, both in the heart of the capital.

This is the company’s first real estate project in Thailand, following ongoing development projects in Singapore and Myanmar. The project calls for about 400 units in total, each costing more than 10 million baht, with construction set to start later and be completed in 2021.

Katsuhito Ozawa, executive managing officer of the Tokyo-based firm, said his company has good long-term prospects for property investment in Thailand and believes that stable economic growth will continue to create more residential demand.

Raimon Land, which will own a 51% stake in the planned joint venture, has mainly specialized in the middle- and upper-grade residences in the center of the capital, and aims to double its annual revenue to 10-12 billion baht in the next five years in partnership with Tokyo Tatemono, chief executive Adrian Lee said.

Japanese developers have been flocking to the Southeast Asian nation since Mitsui Fudosan Co, a leading real estate firm at home, tapped the Thai market by teaming up with Ananda Development Plc in 2013 for a project with 1,875 residential units.

Major rivals such as the Mitsubishi Estate group, railway-to-property and hotel chain conglomerate Tokyu Corp and Nomura Real Estate Development followed suit, forming partnerships with local counterparts.

The 20 joint projects between Mitsui Fudosan and Ananda total about 16,000 housing units, the largest among Japan-Thai alliances, while Mitsubishi Jisho Residence and AP Thailand Public have developed 11 projects, supplying nearly 12,000 units in total.

Meanwhile, various partnerships have emerged such as Hankyu Hanshin Properties Corp and Sena Development Plc, Osaka-based Shinwa Real Estate and Woraluk Property Public, and Tokyo-based Hoosiers Holdings and All Inspire Development Public.

The property market in Bangkok remained vigorous in the first quarter of this year, said Nalinrat Chareonsuphong, managing director of Nexus Property Marketing. “We have started to see more condo projects that target Japanese people in Thailand and we expect to see at least 4-5 mega projects come from Japanese developers this year.”

A Thai real estate analyst, on condition of anonymity, said that Japanese investors have turned to the real estate and service sectors as “a new opportunity” to expand business abroad on the back of steady growth in the property market, especially the condo segment, although they previously focused on the manufacturing sector.

The Thai government’s investment promotion schemes such as the Eastern Economic Corridor and the expansion of mass rapid transit systems in the capital and suburban areas are providing foreign investors with positive factors to tap into the property market.

Mr Nalinrat said the proportion of medium- to small-sized developers, including foreign competitors, increased significantly in the first quarter of 2018.

Japanese investment is also a chance for Thai developers to benefit from funding and expertise, the analyst said. Kyodo

 

source: https://property.bangkokpost.com/news/1460534/japanese-partnerships-mushrooming

Bangkok’s luxury apartments cost less than a studio in Hong Kong

Bangkok’s luxury apartments cost less than a studio in Hong Kong

In chic central Bangkok, a foreign buying binge is fueling a red-hot market for the ultra-luxury real estate.

At 98 Wireless, a luxury condo opened last March in the capital, one buyer from Hong Kong snapped up a US$2.2 million (S$3 million) apartment without more than a moment’s thought.

“It was an impulse purchase for him,” says Uthai Uthaisangsuk, an executive at the project’s developer, Sansiri.

For the price of a cramped studio back home, the investor had bought an opulent two bedroom spread with Ralph Lauren furniture, three bathrooms outfitted with Carrera marble, butler service and a chauffeured Bentley limousine.

Scenes like this have become more common in the Thai capital, where foreign money is pushing up prices at the top of the real estate market, even as developers struggle to sell more pedestrian properties.

With the economy still recovering from a 2014 slowdown, household debt makes it tough for the average Thai person to qualify for a home loan, so companies like Sansiri and Country Group Development are selling luxury to foreigners.

“Developers are having problems selling to locals,” said Ratchaphum Jongpakdee, general manager for Thailand at real estate firm Colliers International Group.

“But they have no problem selling to foreigners.” Buyers definitely get more bang for their buck in Bangkok than in Hong Kong (comparing things like square-footage and bathroom fixtures).

But what’s surprising is that, even though condominium prices in the center of the Thai capital have doubled in the last five years, they’re still cheaper than in less-traveled cities like Jakarta, Kuala Lumpur, or Vietnam’s Ho Chi Minh City, according to real estate advisors.

The price-gap could be set to close, though.

Once a niche tourism destination for backpackers, Bangkok in 2016 surpassed London to become the world’s most visited city, hosting 19 million overnight travelers, about two for every resident. The boom has put the city on the map for investors, especially mainland Chinese who are coming in droves.

Last year, land prices in the city center jumped a record 30 per cent, with foreign investors making up almost a quarter of the capital’s high-end property sales, according to commercial real estate firm CBRE Group.

In the last quarter of 2017, the price of luxury condos rose more than 10 percent, outpacing every other market segment, data from Bangkok’s Real Estate Information Center shows.

Fuel for the fire has come, ironically, because of China’s attempts to stop the outflow of money from its borders.

Caps imposed last year on how much capital people can take out of the country have had the unintended effect of funneling cash into property markets like Thailand’s, where prices are relatively cheap.

A scarcity of buildable land in the city center is a limitation on developers. For investors, though, it’s a big reason high-end apartments should continue to appreciate, according to Patti Tomaitrichitr, an analyst at Macquarie Securities Thailand in Bangkok.

“It’s not easy to find a good plot in a good location right now, so prices will keep going up,” she said.

Sansiri, the developer behind 98 Wireless, the 25-story apartment tower named for its coveted address, began advertising luxury condos to foreign buyers in 2014, when the local economy was in the doldrums.

The company now holds marketing events in Hong Kong almost every month and last year opened three more offices in mainland China, in addition to the one it had in Beijing.

Chinese buyers helped Sansiri sell half of the 77 apartments at Wireless before construction was finished, according to Uthai, the developer’s chief operating officer.

At another luxury condo nearby, the Magnolias Ratchadamri Boulevard, some 80 percent of the units have already sold, with investors from Hong Kong, Singapore and Taiwan accounting for more than half, according to the developer, Magnolia Quality Development.

The 60-story spire features a five-star Waldorf Astoria hotel on the lower floors.

The numbers are similar at the Four Seasons Private Residences, which is currently under construction on the edge of the Chao Phraya River. Some 70 percent of the 355 units have already been purchased, with half of the buyers coming from outside Thailand, according to Ben Taechaubol, the chief executive officer at the developer, Country Group.

Thailand has fewer limits on foreign condo ownership than some places in Southeast Asia. Even though non-citizens are allowed to own no more than 49 percent of the units in any single project, they can buy condos built on freehold land, where ownership doesn’t have a time limit tied to a lease on the underlying dirt. That’s not allowed in neighboring Vietnam or Laos.

Another benefit: Foreign buyers aren’t hit with special taxes, as they are in Singapore and Hong Kong.

The January sale of Britain’s Bangkok embassy, on a coveted freehold land downtown, was Thailand’s most expensive real estate deal ever.

The buyers, a partnership between local and Hong Kong developers, paid the equivalent of about US$600 million for a parcel the size of six football fields. The plan is to knock down the existing colonial-era buildings and put up an office tower with luxury condos or a hotel on top, according to Central Group, one of the new owners.

“Every day, developers are literally knocking on the doors of embassies, businesses and homeowners, anyone with land in the central downtown,” said Ratchaphum, the Colliers executive. “It’s almost impossible to find freehold land in these areas.” BLOOMBERG

 

source: https://www.todayonline.com/world/bangkoks-luxury-apartments-cost-less-studio-hong-kong

Ladprao – Phahon Yothin | New Transportation Hub and Area For Living

Ladprao – Phahon Yothin | New Transportation Hub and Area For Living

The Ladprao – Phahon Yothin area is fast becoming a popular area of residence. There are on-going developments that will give residents in this area access to rail transport and a multitude of lifestyle offerings.

Let’s take a look at the major developments that are driving growth in Ladprao – Phahon Yothin.

 

Ladprao MRT Interchange

Currently, Ladprao – Phahon Yothin area is served by the Green BTS Line and MRT Blue Line, which runs to Asoke as well Bang Sue, the upcoming high-speed rail station. Many bus routes also service the area, and there are two expressways in the vicinity – Sirat Expressway and Uttraphimuk Toll Way (Don Mueang Toll Way).

Soon to be, Ladprao will be the interchange between the current Blue Line and the new Yellow Line.

The line heads east along Lat Phrao road to Bangkapi junction where it will interchange with the proposed Orange Line. The line then heads south along Srinagarindra Road to Hua Mark where it will interchange with the Airport Rail Link (Phattanakan station) (Phase I).

From Hua Mak the route continues south along Srinagarindra Road past Bangna-Trat rd all the way to Thepha Rak rd in Samut Prakhan Province. The line then heads west along Thepha Rak Road before terminating at Samrong where it will interchange with the BTS Sukhumvit Line (extension under construction) (Phase II).

We all know the positive impact transportation nodes have on property prices in the area, don’t we?

 

Bang Sue Grand Station

5 stops away from Ladprao along the Blue Line is Bang Sue. Bang Sue is currently undergoing a major transformation to become ASEAN’s largest rail transit hub. The Bang Sue Grand Station, a mega integrated project is being constructed. This place will be the ultimate interchange for the various rail transports as well as the highly anticipated high-speed rail, which will be running all the way up north to China.

 

Chatuchak Weekend Market

The global renown Chatuchak Market. The 35-acre (68-rai) area of Chatuchak is home to more than 8,000 market stalls. On a typical weekend, more than 200,000 visitors come here to sift through the goods on offer.

 

Central Ladprao

Situated next to Phahon Yothin MRT, Central Plaza Ladprao mall is one of Thailand’s largest and most popular malls. It is also directly connected to the Centara Grand Hotel.

 

The Potential Of Ladprao – Phahon Yothin

According to reports by PLUS Property, a leading Thai real estate agency and research firm, major developers are now snatching up good land plots in the area to launch condominiums. Resale prices have also risen 20%-40% over the last 5 years.

The rental market is also seeing strong returns of 5%.

More Grade A condominiums are being launched and prices are hitting THB180,000 per square meter and the upward trend is set to continue as demand for housing in the area increases.

From another report by Knight Frank in March 2017, all the positive developments are driving demand for housing in the area but supply is relatively low at the moment.


source: Knight Frank Thailand

 

There is potential for real estate in the Ladprao – Phahon Yothin area. The limited available land for development means there is an opportunity for investors to buy a property, be it for investment returns or own stay.

For now, the majority of the purchasers are end users. However, the rental demand is getting stronger as the area develops. According to Plus Property, the occupancy rate is very high at 90% – 95%. Its status as a popular residential area has also meant that independent restaurants, eateries and coffee shops have mushroomed in the area.

This positive trend is likely to continue as the mega-developments come to fruition.

 

Pace of EEC rail projects picks up

Pace of EEC rail projects picks up

PLANNED high-speed and double-track rail projects to serve the Eastern Economic Corridor (EEC) are expected to begin services in 2023, with an investment value of Bt296.42 billion alone flagged for the high-speed train service, the State Railway of Thailand (SRT) said.

 Up to Bt214.3 billion of this amount would be spent on getting the high-speed service up and running, with Bt4.99 billion put to compensation for land expropriation covering 400 rai along the route and the rest allocated to the development of commercial areas around the main station, Chulathep Chittasombat, director of the centre that oversees railway maintenance projects, said at a press conference yesterday.

Chulathep said the two infrastructure projects would equip the flagship economic zone with the rail transport it needs for freight and people.

The terms of reference for the high-speed train project – connecting the Don Mueang, Suvarnabhumi and U-Tapao airports – are being drafted on the expectation for bidding to be opened this year and construction to start in 2019.

“The plots of land planned for expropriation will account for only 5 percent of the total construction area, of which 95 percent will cover the existing rail route,” Chulathep said.

The Office of Transport and Traffic Policy and Planning is conducting a feasibility study for construction of an Inland Container Depot (ICD) in Chachoengsao province to facilitate exports. Inspection and packing would be done before the goods reach ports in the EEC area.

Regarding the second phase of the high-speed train and double-track rail services that will connect industrial estates in the EEC, the SRT is requesting for additional funds to hire consultants, at about Bt200 million for each project, to conduct studies and project design.

The bidding terms for the high-speed project will be announced in July on the expectation for bid submissions in February next year, with the bid winner likely to be announced in May next year. The high-speed project’s full services would start in 2023.

An anonymous source from Bangkok Mass Transit System Plc said that the company is interested in the high-speed project and would assess whether to proceed with a bid based on factors such as expense, the cost of funding, projected income and the break-even period.

“Once the bidding conditions come out, the figures must be taken for evaluation and discussions will be held with a partner on the return on investment. If it’s satisfactory, all the parties will join up in a bid,” the source said.

Piyasvasti Amranand, the chairman of PTT Plc, said that the board had approved PTT Group’s planned purchase of the TOR for the high-speed project with the aim of a conducting a feasibility study into it. No consideration yet had been to given to company’s seeking of a partner for joint investment.

Prasert Marittanaporn, director of CH Karnchang Plc, said that the group was interested in joining the bidding for the high-speed train, citing its readiness to proceed in the construction business.

“The company is ready and interested to bid. But the source of financing may need to be given more consideration, given the relatively high investment,” Prasert said. “It could be an investment on our own or a joint investment with a partner. We have had some talks with potential partners.”

Separately, Deputy Transport Minister Pailin Chuchottaworn yesterday said that, after having chaired a brainstorming session on the creation of an organization for the management of the Thailand-China high-speed rail service, eight financial advisers registered with the Securities and Exchange Commission were invited to bid for a model of the establishment of such an organization. The deputy minister cited the advisers’ expertise in financial management and real estate development.

Initially, the organization may be established as a company to be listed on the stock exchange for fundraising and more management flexibility, he said. It must be a newly established unit owned and controlled by the public sector, independent from the SRT, which owns the high-speed train project, the deputy minister added.

“These financial advisers will present the model of the organization within one month and then, a subcommittee will select the best proposal,” Pailin said. “The winner will be assigned as the project’s financial adviser in return as these financial advisers will conduct the study for us at no cost. The organization is expected to be set up this year.”

The eight financial advisers are Kasikornbank, Siam Commercial Bank, United Overseas Bank (Thai), Finansa Securities, RHB, Ploenchit Capital, Avantgarde Capital, and PricewaterhouseCoopers FAS

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