Golden Land eyes lower-priced market

After almost two years of stagnation, the SET-listed developer Golden Land Property Development Plc (GOLD) plans to aggressively rebuild brand awareness and diversify into a new lower-priced segment.

Pat Seth, the company’s vice-president for development, said it did well in the luxury housing segment after achieving target sales of one billion baht for low-rise units in the first nine months of the year.

“We’re now ready to resume housing developments,” said Ms Pat, who joined the company in August 2008.

The 31-year-old company will outline a development plan for 2010 next month and revise its three- to five-year business plan.

“Last year was a very difficult period for most Thai companies including ours,” she said. “During this period, we improved efficiency in each department, cut costs and downsized by 20% from 200 staff in the second quarter.”

This has made her busier as well, as her job now covers nine departments – from front to back-office operations – work formerly managed by three to four executives.

After making no investments in new land plots the past two years, it will start buying soon as existing projects are popular, Ms Pat said.

One is a plot between 20 and 30 rai in Bang Na where it will develop a housing project with unit prices lower than 10 million baht, a segment it has never tapped.

Golden Land’s main low-rise product is luxury units priced above 20 million baht a unit. It is studying setting up a new subsidiary to cover the segment under 10 million baht a unit, possibly with a new brand.

Ms Pat said the low-rise housing developments would shift from large land plots of more than 50 rai with project values of up to 2-3 billion baht each to smaller projects covering fewer than 30 rai worth around one billion baht.

“The smaller the project is, the better sales it will get,” she added. “We’re trying to use low-rise developments, the major source of revenue, to turn a profit this year.”

According to its report to the Stock Exchange of Thailand, the company posted 812.80 million baht in revenue in the first half, down 26% year-on-year, with a net loss of 60.65 million baht, down from a loss of 152.7 million baht a year earlier. Last year it had a total loss of 461.88 million baht.

“We’re looking at our current assets and will consider which have potential to develop next year,” said Ms Pat. They include a leasehold plot in the Wat Phai Singto area on Ratchadaphisek Road, opposite the Queen Sirikit National Convention Center.

Others include a 120-rai beachfront plot in Krabi and a large plot in Khao Yai where it is considering a golf course, resort and condominium, she said.

Its existing projects are single houses priced from 15 million baht a unit.

GOLD shares closed yesterday on the SET at 3.90 baht, up 28 satang, in trade worth 57.5 million baht.

She knows the ropes
Pat Seth is no stranger to property market cycles, having gained hands-on experience in the United States before returning to Thailand.

Also known as Patriya Sethabut, she graduated from the University of California, Berkeley with a bachelor’s degree in Liberal Arts, majoring in Social Sciences, in 1994. She came back to Thailand, and worked as an investment analyst for JP Morgan Jardine Fleming Securities until 1996.

She then returned to Los Angeles to work as a business consultant and help her family run the CY Set Trust, a private trust owned by her family who lived there. The trust invested in used homes, condominiums and apartments through buying and renovating properties before selling them during the property boom in US.

“Margins were up to more than 100% during that hot period,” she said. The trust’s investment covered Los Angeles and Boston. While running the trust, she also extended her education at Harvard University in 2004 and completed a master’s degree in real estate two years later.

“When we saw a sign of overheating in the US property market, we decided to exit the market and closed the trust,” said Ms Pat who still has a home in Pasadena, California where she parks some classic Italian automobiles, her hobby.

She came back to Thailand again in 2006 and worked as a director at Krungthep Land, a luxury residential property developer and a joint venture between SET-listed Property Perfect Plc and Singapore-based Frasers Property.

In 2007, she was made a director of US-based Destination Properties, a resort developer active in Phuket, Samui and other destinations in Asia in partnership with Lehman Brothers and Merrill Lynch, a position she held until August last year.