Well-known property developer David Groom passed away on December 10th.
He was co-developer of one of the island’s first luxury villa projects Katamanda in Kata Phuket.
Groom was a long-time Thai resident and real estate entrepreneur who worked on a number of projects both in Phuket and Bangkok over the years.
A cremation will be held on this coming Saturday December 17th at Wat Dansamrong, Samutprakarn Province at 1700 hours.
Global icon Café Del Mar is set to debut in Phuket next year, with an opening date to be announced soon. Construction of the project is well underway.
Located on booming Kamala Beach, the oceanfront venue which is adjacent to the Twinpalms operated HQ is part of the MontAzure integrated development.
Advising the Phuket Café Del Mar is Bangkok-based Ms. Supaluck Umpujh, chairwoman of The Mall Group and well-known entertainment operator Santeri Nurmi.
Work on the Mall Group’s new BLUPEARL Mega retail complex in Kathu Phuket is expected to start off early in 2017.
Café Del Mar is the latest addition to MontAzure, which includes the Twinpalms Residences, and a luxury InterContinental Hotel.
I was recently in Bali and had an up close view of the hotel and property scene on the island.
This year’s surge in visitor arrivals is continuing and while the Chinese are the second largest international source of business, inroads are being made in a number of other markets.
Speaking to some of the villa rental groups, two geographic sources that are gaining momentum are India and the Middle East.
What is perhaps a bit surprising is that garden or enclosed villas often the choice of the latter group.
That said, one long-term operator of multiple villa estates said that looking at this years figures, while occupancy is up, rates are under stress and once you add in Bali’s hyper-inflationary operating costs of labor and utilities, his bottom line is actually shrinking despite gains on the top line.
Hotel owners and property managers are feeling the crunch in a similar way as Phuket, where occupancy has been accelerating revenue and a knock on effect for RevPAR but the profit line is diminishing.
One more important factor is the growing impact of OTA’s. While bookings are rising, the cost is equally being driven up and profits diminishing.
On the hotel side, after seeing a soaring pipeline the past few years, there was an economic impact from the decline of global energy prices on the Indonesian economy.
This manifested itself in a number of projects being put on hold, but there is a renewed push in many developments.
Notables I saw was the soon to open Movenpick Jimbaran, which has an attached retail and food cluster that is already buzzing.
Other notables is the InterContinental in Berawa, Mandarin Oriental in Pandawa, Six Senses Uluwatu and coming up fast is the massive New World Resort Pecatu.
While tourism is roaring ahead, I can see similar traits to Phuket as micro location become a key trading factor due to increasing traffic.
And there is also the issue of hotel owners seeing smaller profit lines, while hotel management companies introduce an endless flow of new brands.
Growth is not adding up to profit in many cases and something will have to give in the longer term to sustain quality accommodation and a healthy marketplace.
The potential lease of the Phuket’s British International School to institutional group Nord Anglia Education has failed to materialize.
In a letter issued by the school’s CEO Mr. Apiwat Ourairat said “It was felt, at this point, that to continue as an independent institution would be in the best interests of the school.”
Hong Kong based Nord Anglia operate 43 international schools across the globe with over 35,000 students.
Earlier this year BIS announced it was entering a period of due diligence with the group, but at the end of the day the island’s largest international school has opted to remain independent.
For the most part, the booming tourist high season at the start of 2016 was a challenge for the island’s luxury real estate sector as it there was no domino effect. It was almost a throwback to the age of Christopher Columbus where the common thought was the world is flat, but in this case the villa market went stone cold.
Today as we edge towards yet another winter peak high season, the question for the property market is what does the future hold? We have just released the new C9 Hotelworks Phuket Luxury Villa Market Update 2016 (click to download).
Based on our analysis the prevailing market has seen a sharp rise of secondary sales versus primary market transactions. At the same time Bangkok and other Asian CBD urban offerings are now seeing a surge in overseas buyers at the top end of the market. Take note of the hotel branded residences on the river such as the Four Seasons and Mandarin Oriental offerings. Hence competition is heating up.
You can also factor in the global economic slowdown and volatile currency, yet if we turn back the clock and look Asia’s real estate post the Global Financial Crisis, the ultra-luxury segment was one of the first markets to pick up and showed sustained traction during that time period.
Back of the island’s push in secondary sales, the reality is that many of these villas are prime properties and there continues to be limited choices and high barriers to entry so the fact that some early buyers are exiting is simply a fact of a recurring market cycle and not of over-supply.
Getting inside the numbers I find comfort knowing the existing luxury real estate market of properties has a current value well in excess of USD1 billion. In Asia, it remains the most demonstrated top end resort property segment in the region. Do the math, drive around the island and start adding up the existing values on Kamala’s Millionaires Mile, Nai Thon, Bangtao, Surin, Cape Yamu or Cape Panwa.
Looking forward to the end of 2016 and on into 2017, the pick-up of sales at Bill Heinecke’s The Residences by Anantara in Layan is signaling the start of a new cycle. Strong interest at The Estates at MontAzure with their large land plots and signature design by celebrity designers Lek Bunnag and Jaya Ibrahim bodes well.
While in the wings is the banner Rosewood resort with its multimillion dollar villas that are currently under development will see estate villas come into the market. Hong Kong’s New World Development chose Phuket for their luxury brand’s Asian flagship for a reason.
Again and again we have learned the cyclical nature of the market. And while our new report spells out current trading challenges our forecast is that we are about to enter a new cycle and this will likely see a spur in renewed interest back of impressive new products in the luxury real estate segment.
Thailand’s Sansiri is teaming up with celebrity designer Philippe Starck’s YOO for a new stylish condominium in Bangkok’s Thonglor area.
The property name is Khun by YOO, inspired by Starck is a 27 story high-rise with 148 condos.
Pricing points start at THB15 million and a sales launch is planned for November 4th to 6th.
This is Sansiri’s second design-affiliated project with the first being a tie-up with Ralph Lauren Home at the luxury 98 Wireless Road condominium.
Hello Kitty. Singapore’s SC Capital Partners have made public plans to raise USD1 billion based in surging demand by fund investors.
According to news on Bloomberg, SC’s Chairman and Founder Thai-national Suchad Chiaranussati “office buildings, hotels and other properties in the region” are likely targets.
Here in Phuket, SC Capital has been a substantial hospitality investor through affiliates in the acquisition and sale of the Laguna Beach Resort, and then buying the Manathai Surin and the upgraded luxury Nai Harn resort.
SC is planning to sell the leasing rights to Bangkok’s Mercury Tower which has undergone an extreme makeover and will be trade into a REIT (Real Estate Investment Trust).
The Twinpalms Residences MontAzure was recognized as the winner of the best condo award at the Thailand Property Awards 2016.
This is the 11th year for the awards which are recognized as the leading real estate event in the country.
As a development was designed by leading architect Martin Palleros of Tierra Design.
C9 Hotelworks has provided consulting services for the hospitality-led beachfront residences.
While Mainland China is spurring a sustained drive in Thailand tourism, one key element that is undermining the industry is “zero dollar” tourism.
What is “zero dollar” tourism? These are essentially Chinese tour operators who work with local counterparts to take mostly Mainland travelers to a series of jewelry shops, attractions, entertainment venues who mark-up goods and services at high value prices. They essentially avoid local establishments and work with affiliates or with high-commission levels pushing prices up.
This is not a small industry and as the Bangkok Post reported (see article) this week it’s a billion baht industry and the revenue coming in is being funneled back to Mainland China, and there is large-scale avoidance of Thai tax.
It’s impossible to blame the package tourists who come here, as they are the ones being taken advantage of, and falling prey to this sad phenomenon of volume tourism.
From a further perspective Thailand is not the only country seeing the influx of “zero dollar” tourism, one only has to go to Bali and drive along Sunset Road to see the tour buses parked in front of retail shopping megaplexes.
This week’s flurry of media coverage in the national press is a good thing, and clearly the government is looking at addressing the blot on the face of Thai tourism.
That said there is concern that by hitting the “zero dollar” segment that tourism numbers could be hit, but overall addressing the issue will be long term gain for short term pain.
