Bangkok’s appetite for top end luxury condominiums is accelerating as the geographic mix of products is spreading across the Thai capital. According to C9 Hotelworks new Bangkok Luxury Condominium Market Update a significant number of developers are shifting into more upscale offerings given high penetration in the mass mid-scale segment.
What is apparent from C9’s research is that there is traction from both investment oriented and end users for luxury real estate. That said, speculation at the pre-sales point and flipping units prior to project completion remains visible. Likewise the appetite for premium penthouse units remains an ongoing trend, though unit sizing is becoming rationalized.
Over the past few years the emerging development of high-end projects on the Chao Phraya River is popular for both foreign buyers who enjoy the unique aspect and possibly issue these as second homes, but also Thai’s who view the location as more serene and lifestyle oriented for their primary residence.
In our analysis though the riverside location remains challenged in terms of broad hotel and upscale retail demand. Upper-tier hotel demand remains strongly grounded in the leisure segment, given access issues and the overall limited amount of office supply. Room rate growth for hotels has been restrained by the lack of corporate business and reliance on tourism which has been impacted by lower-rated business from the emerging mass tourism segment.
Taking a forward look at the expansion of the BTS, this will potentially ease the accessibility issue but there is a defined lack of large-scale offices in the catchment area. Another possible concern is the incoming of massive retail complexes that will need to be focused mostly on residential demand and tourism, though these may see some diminished numbers from marginal office-connected footfall.
Taking this into account, there is little doubt that transport and infrastructure are the leading proponents of change and the expansion and diversification of Bangkok’s mass transit network will create a more connected urban background. Three significant re-development entries that are on the radar are the Dusit Thani – Central Pattana (CPM) mixed-use Silom entry, the nearby Suan Luan project by the TCC Group and potentially the massive SRT site at Makkasan.
The pairing of hotels and luxury residences in Bangkok is following a similar trajectory as much of Asia with urban properties seeing greater numbers compared to the legacy beach destinations. A series of new hotel branded residences that are affiliated to names such as St. Regis, Four Seasons, Mandarin Oriental and Ritz-Carlton have become important branding tools. Yet, from our research brand premiums for this properties compared to the large pure residential market is only seeing a premium of four to nine percent. In a nutshell hotel residences may have slightly higher pricing but once you look at demonstrated sales absorption, the pure residential offerings are driving the numbers game.
As we look further to the future, and the continued urban growth of Bangkok the emergence and definition of mini-metros will continue. As in other Asian cities the shift of high net worth individual from their traditional low-rise palatial houses into high-rise urban condominiums is expected to intensify. High-rise living is a coming of age in Asia, as land values surge, there is nowhere to go but up.
Locations are also changing and the Silom and peripheral area with the current wave of mega mixed use project are expected to challenge the Sukhumvit and Thonglor areas and may take some of the momentum from the fast developing riverside area. For now, there is little doubt the luxury residential offerings have captured the imagination of the Bangkok property scene. Perhaps the most relevant point for property developers is that from our analysis of the numbers is that there continues to be upside appreciation and pricing gaps for top end real estate when viewing current and expected demand coupled with the value paradigm versus other global gateway cities.
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Feedback from this weekend’s Singapore property launch of the Mandarin Oriental Residences Bali has been extremely positive.
In a showcase at the Lion City’s Mandarin Oriental hotel, SQFT Global Properties and Christie’s teamed up for the sales and marketing effort.
With 91 villas adjacent to the Bukit Pandawa Golf Course in Bali, the development has been designed by globally renowned design Jean-Michel Gathy.
The Bali offering is creating renewed interest in high level offerings on the Island of the Gods where real estate over the past few years has been largely dominated by condohotels.
Making news in Thailand are comments by the Finance Ministry that the government is seriously reviewing an extension of real estate leases to 50 years.
Currently the law restricts foreigners to either own freehold condominiums in 49% in projects or else take the leasehold route with a 30 year term and renewal option.
One of the key drivers is a measure to stimulate leasehold property sales in the secondary market by creating an extended term.
For now, as in the past, the property industry remains cautiously optimistic over the news.
This year’s AOCAP Conference has been set for Singapore on the March 15th and 16th.
Once again the Pan Pacific hotel will be the venue and registration is now open.
The only Asia Pacific conference focused on alternative ownership and mixed-use resorts. Direct content includes exclusive insight into Timeshare and Vacation Clubs, Branded Residences, Condo Hotels, Private Residence Clubs and Fractional Ownership.
On stage will be Bill Barnett, Managing Director of C9 Hotelworks along with senior executives from Minor Hotel Group, Wyndham Hotels and Resort and Interval International.
For more details CLICK
Bernold Schroeder has resigned as CEO of Pan Pacific Hotels Group.
The move is effective from the beginning of January and the company has said a new Chief Executive will be named soon.
For many in Thailand they know Schroeder for his long tenure with the Banyan Tree chain.
Gwee Lian Kheng will lead Pan Pacific on an interim basis until a replacement has been named.
Legendary designer Linda Garland who was best known for promoting Bali-style has passed away in Australia.
The news has come from BaliDiscovery.com and is latest in a line of deaths of well-known creative icons that gained fame in Indonesia including Made Wijaya and Ibrahim Jaya.
Garland who lived in Ubud for many years was a strong proponent of bamboo materials along with fitting out villas for a series of world famous celebrities.
She left Ubud a few years ago after selling her signature home.
Over the past few years C9 Hotelworks has completed a number of consulting projects in Sri Lanka ranging from luxury villas, mixed-use hotel, office and retail complexes, resorts and mid-scale hotels.
The economic progress in the country has been sustained and both the tourism and real estate sectors are experiencing a surge in demand, as Sri Lanka is one of Asia’s key emerging markets.
We have put together a market overview of one of the country’s leading destinations, which is the Southern Coastline.
This covers key areas including Galle, Weligama, Mirissa and Tangalle.
For Thai hospitality groups, there are now a number involved in the coastal areas including Anantara (Minor), Onyx and Dusit.
To download and read the overview (CLICK).
Laguna Phuket is developing 30 hotel branded condo units named the Angsana Beachfront Residences.
Located adjacent to the Angsana Resort on vacant land, and on the other side of the Movenpick Bangtao Beach, the key selling point is unobstructed ocean views.
The project has elected to use a condominium structure versus previously leasehold offerings as has been typical of Laguna Phuket properties.
A core offering of two and three bedroom units, range from 214 to 351 square meters with a four bedroom option on request.
For investment buyers the opportunity is given for buyers to have the Angsana Resort manage their property with 60 days annual usage.
Pricing points are from THB32 to THB52 million.
Hong Kong private equity group LimeTree Capital Partners has acquired the Shiki hotel in Japan’s prime ski area of Niseko.
Located in the upscale Hirafu area, the complex has 67 one to three bedroom apartments.
It also features a Michelin star restaurant Kamimura.
Niseko is seeing an influx of new hotel properties including the Park Hyatt from Hong Kong entrepreneur Richard Li, a recently announced Pavilions resort and an upcoming Ritz-Carlton.
LimeTree is a significant investor into resort land plots in Southeast Asia, highlighted by holdings in Phuket and Phang Nga Thailand.
