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Prices here deemed ‘a challenge to investors’ by agency

The average price being paid for a condominium unit in the Central Lumpini area is now Bt112,765 per square metre, ranking higher than other popular locations in central Bangkok, according to real-estate firm CB Richard Ellis Thailand.

This is followed by units in the Sukhumvit area, which are presently averaging Bt100,549 per square metre, and those near Silom and Sathorn roads, which are selling for an average of Bt95,311 per square metre.

These are still substantially below the record of Bt370,000 per square metre set in the second quarter of last year by The Sukhothai Residences on Sathorn Road. The price was reached when the developer had sold 70 per cent of the presales target, so sales were temporarily closed in June 2008.

CB Richard Ellis (Thailand), the project’s property agency, said sales would reopen nearer to the project’s completion.

Q Langsuan on Rajdamri/Rama IV is currently the city’s most expensive residential project, recording prices between Bt180,000 and Bt280,000 per square metre. About 30 per cent of the project, which has a market value of Bt3.4 billion, has now been sold, said Risinee Sarikaputra, research and advisory director at Colliers International Thailand.

Although Q Langsuan has recorded higher prices than other residential projects in Bangkok’s central business district, they are still considerably lower than prices for residences in other central business locations in Asia, such as Hong Kong and Singapore, Risinee said.

According to a survey by Colliers International Thailand, the highest price being paid for a luxury residence in Hong Kong is 31,819 Hong Kong dollars (Bt140,000) per square foot (or Bt1.51 million per square metre) for the Gough Hill Residences, located in The Peak area. This price has fallen 8 per cent from last year.

The average price for residences in Hong Kong’s central business district is about $16,103 per square foot (or Bt767,000 per square metre). This price has fallen about 30 per cent since the final quarter of 2008, following the onset of economic recession in Hong Kong. It is still more than six times higher than the average prices in the most popular parts of Bangkok’s central business district.

The highest-priced luxury residences in Singapore are likely to be found at the Mercury project on Shanghai Road, where the current best offer is US$1,250 (Bt42,600) per square foot (or Bt461,000 per square metre). This price has dropped 13.8 per cent from last year’s fourth quarter, when the global economic recession reached Singapore.

It is still four times higher than that for residences in Bangkok’s central business district.

Demand for luxury residences in Bangkok has fallen significantly since the second half of last year, when the global economic downturn saw foreign buyers withdrawing their investments from the Thailand market, Risinee said.

However, when Bangkok’s luxury residences are compared with those in Singapore and Hong Kong, those on offer in Bangkok represent an attractive challenge to investors looking for long-term arrangements, she said.

Last week, Israel’s largest real-estate developer, Industrial Buildings, a subsidiary of the Fishman Group, announced a joint venture with local company Pace Development for the Bt18-billion Maha Nakhon project.

Fishman Group managing director Anat Menipaz-Fishman said her company had decided to enter Thailand’s property market, because prices here were four times cheaper than those in Singapore and six times lower than those in Hong Kong.

The Maha Nakhon project will comprise luxury condominiums, hotels and retail space on a land plot of about 9 rai held on long lease on Narathiwat Road, near Chong Nonsi Skytrain Station.

About the author

Somluck Srimalee Somluck Srimalee
Somluck Srimalee is a journalist with The Nation, Bangkok's independent English language newspaper and specialises in the property and real estate sectors.
Other posts by Somluck Srimalee ( 56 )
Website: http://www.nationmultimedia.com

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