Foreigners seek bargains

Strong interest in depressed assets, which are going 30% cheaper than last year.

Declines in the prices of land and residential projects have prompted some foreigners to expand their investments in Thailand’s property market, especially condominiums.

According to a survey by The Nation conducted last week, foreign investors are confident that it is a good time to buy Thai property, both in Bangkok and upcountry.

Some have shown a strong interest in buying depressed assets, which are going for 20 to 30 per cent less than last year.

Interest is also being shown in undeveloped land for the purposes of developing residential projects, as land prices are down 10 to 20 per cent from last year.

Hub Soon Global Corporation Singapore subsidiary United Motor Works (Siam) has set up a joint venture with Chiwathai, called Chiwathai Hub Soon, to develop a low-rise condominium project. Worth Bt350 million, the project is called The Surawong by Chiwathai Hub Soon.

The company also plans to buy undeveloped land and take over existing residential projects worth nearly Bt1 billion this year and next, director Henry Heng said.

“We believe that Thailand’s |property market [is attractive to] foreign investors, as land and |residential project prices are now cheaper than last year,” he said.

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Property management firm Akando, whose clients include Lizmans Property Fund, plans to take over a residential project on Rama IX Road in the capital worth Bt2 billion this year. The project is already under construction but the owner wants to sell. This follows Akando’s purchase of three other Bangkok condominium projects in Lat Phrao, Suthisarn and Rama III Road, starting last year.

Managing director Joel Feldman said the company has a strong interest in buying or taking over property projects, with land and residential prices having dropped significantly because of financial difficulties faced by land and residential project owners. Almost all of these owners have lowered their prices in an effort to secure sales, he said.

“We believe this is a good time to invest in Thai property, because we expect the US economy to recover in the last quarter of this year, which should drive Thailand’s economic recovery,” he said.

ECC Group, a Netherlands-based retail developer, has set aside an investment budget of US$90 million (Bt3.24 billion) to develop a large-scale shopping mall called Promenada in Chiang Mai.

Chairman and founder Dion LJ Heijmans said revenue from shopping malls in Asia is projected to grow by more than 10 per cent a year, compared to growth of just 4 to 5 per cent for the group’s Promenada brand in European markets.

Having chosen Chiang Mai for its first project in Thailand, ECC will next consider entering the Bangkok market.

Heijmans said construction of the Promenada on Chiang Mai’s Ban Sahakorn Road would start by year’s end, with the opening scheduled for the last quarter of 2011.

The group is also seeking a good location in Bangkok with space of at least 100,000 square metres for a two-storey shopping mall. Other potential locations include Phuket, Hua Hin and Pattaya, he said.

Number of foreign investors expand their investment in Thailand’s property market especially condominium projects that thank to land price and projects price dropped.

According to survey by The Nation last week foreign investors have strong confident to expand their investment in Thailand’s property market the both in Bangkok and upcountry.

Some of them have strong interest to buy depressed asset, which offer price lower than last year between 20 per cent and 30 per cent.

As some of them also have interested to buy undeveloped land to develop residential projects because of land price now drops between 10 per cent and 20 per cent when compare with last year.

Hub Soon Global Corporation Singapore’s subsidiary United Motor Works (Siam) Plc has set a joint venture firm with Chiwathai Co ltd to establish Chiwathai Hub Soon Co Ltd to develop low-rise condominium worth Bt350 million that calls ‘The Surawong by Chiwathai Hub Soon’ early this year.

The company also plans to buy undeveloped land or take over existing residential projects to develop in this year and the next year worth nearly Bt1 billion, the company’s director Henry Heng said.

“We believed that Thailand property market have continued to challenge for foreign investor when land and residential price now offer reasonable price that cheaper than last year,” he said.

The property management firm Akando Co Ltd who also managed projects for Lizmans Property Fund, plans to take over residential projects, which is going on construction process but its project owner want to sale the project, on Rama 9 worth Bt2 billion in this year. This is following the company bought three condominium projects at Lad Praod, Suthisarn, and Rama 3 since last year till now.

The company’s managing director Joel Feldman said that the company strong interest to buy or take over projects in Thailand property market when land and residential price have significant to drop when some of land owners and residential project owners faced financial problem. Till almost of them decided to cut price for sale.

“We believed that this is a good time for invest in property business in Thailand because of we believed that USA’s economy will recover in the last quarter of this year that will drive Thailand’s economy recovering,” he said.

ECC Group, a Netherlands-based retail developer, set aside an investment budget US$90 million or about Bt3.24 billion to develop large-scale shopping mall that calls Promenada’ in Chiang Mai.

The company’s chairman and founder Dion LJ Heijmans said shopping malls’ revenue in Asia is projected to grow by over 10 per cent per year, compared to growth of just 4 to 5 per cent for the group’s Promenada brand in European markets.

Chiang Mai was chosen for the first project in Thailand, after which the company will consider entering the Bangkok market.

Heijmans said construction of the Promenada - on Chiang Mai’s Ban Sahakorn Road - would start by year’s end for opening in the last quarter of 2011.

The group is also seeking a proper location in Bangkok with space of at least 100,000 square metres for a two-storey shopping mall.

Other potential locations include Phuket, Hua Hin and Pattaya.

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 ( 43 )
Website: http://www.nationmultimedia.com

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