Google marks 10th birthday and celebrates the spirit of our users and the web, launches Project 10^100 (that's "ten to the hundredth") a call for ideas that could help as many people as possible, and a program to bring the best of those ideas to life. CNN will be covering this project, including profiles of ideas and the people who submit them from around the world. For a deeper look, follow along at Impact Your World.
Ideas are due by October 20, 2008. Get started submitting your own ideas, and come back on January 27th to vote on ideas from others. We hope you feel inspired enough to try. I wish you to submit your ideas here. Wishing good luck, and may the ones who help the most win.
Official Google Blog: Project 10^100
Thursday, October 9, 2008
Saturday, July 19, 2008
Deals for early birds
Rising inflation and soaring oil prices that push up construction costs have triggered increased activity in the new supply of condominiums reaching the Bangkok market this year, says James Pitchon, executive director of CB Richard Ellis.
As soaring building material prices pushed construction costs up by 20-30% in the first half of this year, end-users and investors are now shopping around for good units among buildings that have been completed or are to be completed this year because they were built from a lower cost base. This is also what gives this new batch of buildings a clear edge over new projects being sold off-plan.
One example Mr Pitchon gave is Athe'ne'e Residence on Wireless Road, where resale units have been sold for as high 150,000 baht a square metre but this is probably cheaper than the price a new project in the same area could be sold today.
"This year I expect we will see increased activity in The Met which will be due for completion in the first quarter of next year. People driving past that side of Sathorn will see very fast construction progress."
Soaring costs have hit Bangkok harder than some other key metropolises. Here, the construction element is as much as 50% of the development cost whereas in cities such as Hong Kong, Singapore and London the land element can be as much as two to three times more than the total construction cost. CB Richard Ellis has observed that building material costs are similar across the globe with the difference being labour charges.
Resale units at Athénée Residence are fetching up to 150,000 baht a square metre, but a new luxury building in the same central Bangkok location would likely cost a lot more.
Mr Pitchon added that while many markets around the world were declining, Bangkok was fortunate to be in a more stable position because price increases here had been closely linked to construction costs rather than land price inflation or abnormally large developers' profit margins.
"In summary, it's not going to be any cheaper to build a new condominium unless there is a fall in construction costs which is unlikely in the next 12 months."
Clearly, developers of condominiums reaching the market this year are sitting pretty, provided their projects are well located and the designs match market requirements. Aside from the price factor, buyers appreciate the fact that they are getting something that has already been built and can be assessed as is.
"Buyers will have the opportunity of having a wide range of projects that are approaching completion. They can see what they get in terms of quality. They significantly reduce risk because it has been built - if the building is finished, it's there and ready. "
Also it is end-users and investors who will drive prices in the new wave of buildings hitting the market this year and not speculators because they are the ones who will be buying. Mr Pitchon expects each building to set its own benchmark price based on what the market thinks the quality of development is.
However, he observed that not all buildings had benefited from this turn in the market. Some of the last generation of buildings, which are around 10 years old, are only able to achieve around half the price of the the product next door.
"One of the main reasons is co-owners have not invested in refurbishment of common areas. In a single ownership property such as an apartment or a hotel it would be normal every five to seven years to significantly remodel the lobby area and the corridors. This has not happened in many residential buildings because they were not able to get agreement from a large enough number of co-owners to contribute to capital improvements. The achievable price of some of these older buildings is the same as it was in 1994, whereas there is a new product selling at double the price."
Mr Pitchon underscored that today's situation was in fact an opportunity for existing building co-owners to substantially increase the value of their property by making their buildings more attractive. If a building's sinking fund has depleted then co-owners should raise the cash required because they should invest in their property.
From the developers' point of view, the challenge this year is managing risks. The biggest risk is the cost of building their projects and in Mr Pichon's view they would be wise to fix these costs with contractors before launching sales.
"In addition, buyers want to see that buildings have all the necessary permits before buying off-plan, so buyers will want to see a building permit and environmental impact assessment if that is required. This is because there have been cases where developers have not been able to transfer units because either they have been in breach of their building permit or they have not received environmental impact assessment."
Despite these market challenges, Mr Pitchon observed that Bangkok had changed significantly over the last 10 years with the biggest change being that condominium living has become more acceptable both for the wealthy and the middle class.
"People want to live in the city centre and the central routes of BTS and MRTA have firmly defined where the city centre is. So Bangkok has become an inward-looking city where people have no choice really but to live in condominiums because single detached houses and townhouses are too expensive in the city centre.
"Despite the challenges of construction costs, I think the concept of living in a condominium is here to stay and the development pattern of Bangkok has changed from a city that is constantly moving outwards to a city that has become far more centrally focused."
Source: BangkokPost
As soaring building material prices pushed construction costs up by 20-30% in the first half of this year, end-users and investors are now shopping around for good units among buildings that have been completed or are to be completed this year because they were built from a lower cost base. This is also what gives this new batch of buildings a clear edge over new projects being sold off-plan.
One example Mr Pitchon gave is Athe'ne'e Residence on Wireless Road, where resale units have been sold for as high 150,000 baht a square metre but this is probably cheaper than the price a new project in the same area could be sold today.
"This year I expect we will see increased activity in The Met which will be due for completion in the first quarter of next year. People driving past that side of Sathorn will see very fast construction progress."
Soaring costs have hit Bangkok harder than some other key metropolises. Here, the construction element is as much as 50% of the development cost whereas in cities such as Hong Kong, Singapore and London the land element can be as much as two to three times more than the total construction cost. CB Richard Ellis has observed that building material costs are similar across the globe with the difference being labour charges.
Resale units at Athénée Residence are fetching up to 150,000 baht a square metre, but a new luxury building in the same central Bangkok location would likely cost a lot more.
Mr Pitchon added that while many markets around the world were declining, Bangkok was fortunate to be in a more stable position because price increases here had been closely linked to construction costs rather than land price inflation or abnormally large developers' profit margins.
"In summary, it's not going to be any cheaper to build a new condominium unless there is a fall in construction costs which is unlikely in the next 12 months."
Clearly, developers of condominiums reaching the market this year are sitting pretty, provided their projects are well located and the designs match market requirements. Aside from the price factor, buyers appreciate the fact that they are getting something that has already been built and can be assessed as is.
"Buyers will have the opportunity of having a wide range of projects that are approaching completion. They can see what they get in terms of quality. They significantly reduce risk because it has been built - if the building is finished, it's there and ready. "
Also it is end-users and investors who will drive prices in the new wave of buildings hitting the market this year and not speculators because they are the ones who will be buying. Mr Pitchon expects each building to set its own benchmark price based on what the market thinks the quality of development is.
However, he observed that not all buildings had benefited from this turn in the market. Some of the last generation of buildings, which are around 10 years old, are only able to achieve around half the price of the the product next door.
"One of the main reasons is co-owners have not invested in refurbishment of common areas. In a single ownership property such as an apartment or a hotel it would be normal every five to seven years to significantly remodel the lobby area and the corridors. This has not happened in many residential buildings because they were not able to get agreement from a large enough number of co-owners to contribute to capital improvements. The achievable price of some of these older buildings is the same as it was in 1994, whereas there is a new product selling at double the price."
Mr Pitchon underscored that today's situation was in fact an opportunity for existing building co-owners to substantially increase the value of their property by making their buildings more attractive. If a building's sinking fund has depleted then co-owners should raise the cash required because they should invest in their property.
From the developers' point of view, the challenge this year is managing risks. The biggest risk is the cost of building their projects and in Mr Pichon's view they would be wise to fix these costs with contractors before launching sales.
"In addition, buyers want to see that buildings have all the necessary permits before buying off-plan, so buyers will want to see a building permit and environmental impact assessment if that is required. This is because there have been cases where developers have not been able to transfer units because either they have been in breach of their building permit or they have not received environmental impact assessment."
Despite these market challenges, Mr Pitchon observed that Bangkok had changed significantly over the last 10 years with the biggest change being that condominium living has become more acceptable both for the wealthy and the middle class.
"People want to live in the city centre and the central routes of BTS and MRTA have firmly defined where the city centre is. So Bangkok has become an inward-looking city where people have no choice really but to live in condominiums because single detached houses and townhouses are too expensive in the city centre.
"Despite the challenges of construction costs, I think the concept of living in a condominium is here to stay and the development pattern of Bangkok has changed from a city that is constantly moving outwards to a city that has become far more centrally focused."
Source: BangkokPost
Rental business grabs spotlight
With economic difficulty inhibiting business growth, an opportunity exists within the property industry to generate high returns on investment.
This opportunity lies in the rental segment.
Unlike condominium projects, which face a higher degree of competition, the rental business is growing increasingly popular among land owners in Sukhumvit Road and other main streets of Bangkok due to lower investment and less competition.
Jones Lang LaSalle's residential agency head Daonum Verapong said the rental business was becoming more popular among investors because it not only creates value from the assets, but also generates high profits.
"Many investors and owners of land between 200 and 400 square metres in Bangkok will build houses for rent for use by foreigners," he said.
"This kind of investment helps increase income for landowners rather than keeping the land, which otherwise devalues with time," Daonum said.
Clients in the luxury and high-end segments require a high degree of security, private zones and integrated services.
Clients, who are usually executives in large organisations, are willing to pay a rent of between Bt150,000 and Bt300,000 a month for a two-to-three-year contract for a property covering 400 to 450 square metres.
Beside houses located in business areas, Bangkok's surrounding districts - such as the Ekamai-Ram Indra Road, also known as the Beverly Hills of Bangkok - are some of the more interesting locations for the rental business.
This area is located close to the city, offers a convenient commute, is well known among foreigners and is well connected to Sukhumvit Road.
Due to these factors, the area is fast replacing Sukhumvit Road as the destination of choice for upper-class residents. Depending on the property's size, the rent can be between Bt60,000 and Bt120,000 a month.
Many properties are available for rent in the area.
Bangkok Villa, operated by City Realty and located on Ekamai-Ram Indra Road (Lat Phrao Soi 84) on 13 rai, is one such property. The project offers 30 to 40 units for a monthly rent of Bt80,000-Bt90,000 per unit. Each unit has two-to-three bedrooms, and offers facilities such as a sauna, cable television, a swimming pool, cleaning services and security.
Perfect Masterpiece on Ekamai-Ram Indra, developed by Property Perfect, offers 17 units for rent at Bt65,000 to Bt100,000 a month depending on the size of the property and duration of the contract. Jones Lang LaSalle is the sole agent for the project.
Daonum said this project targets foreign executives who are looking for single houses with a convenient commute to Sukhumvit Road .
This project, built on 97 rai, has 167 single house units, which are available either in finished form or can be built to order.
The project is valued at Bt3.49 billion and units are available for sale at prices between Bt11 million and Bt57 million. Although the project offers only 17 units for rent, owners in the project are also offering houses for rent. The rental fee can be negotiated within the Bt60,000-to-Bt70,000 range if the contract is for more than two years.
The rental market targeting foreigners is a new alternative for investors to generate high returns.
Many major property developers have turned their focus more on the rental business. Landowners, who are unaware of how to generate value from their assets, should consider the rental business for investment as it holds great potential at the moment.
Source: Nation
This opportunity lies in the rental segment.
Unlike condominium projects, which face a higher degree of competition, the rental business is growing increasingly popular among land owners in Sukhumvit Road and other main streets of Bangkok due to lower investment and less competition.
Jones Lang LaSalle's residential agency head Daonum Verapong said the rental business was becoming more popular among investors because it not only creates value from the assets, but also generates high profits.
"Many investors and owners of land between 200 and 400 square metres in Bangkok will build houses for rent for use by foreigners," he said.
"This kind of investment helps increase income for landowners rather than keeping the land, which otherwise devalues with time," Daonum said.
Clients in the luxury and high-end segments require a high degree of security, private zones and integrated services.
Clients, who are usually executives in large organisations, are willing to pay a rent of between Bt150,000 and Bt300,000 a month for a two-to-three-year contract for a property covering 400 to 450 square metres.
Beside houses located in business areas, Bangkok's surrounding districts - such as the Ekamai-Ram Indra Road, also known as the Beverly Hills of Bangkok - are some of the more interesting locations for the rental business.
This area is located close to the city, offers a convenient commute, is well known among foreigners and is well connected to Sukhumvit Road.
Due to these factors, the area is fast replacing Sukhumvit Road as the destination of choice for upper-class residents. Depending on the property's size, the rent can be between Bt60,000 and Bt120,000 a month.
Many properties are available for rent in the area.
Bangkok Villa, operated by City Realty and located on Ekamai-Ram Indra Road (Lat Phrao Soi 84) on 13 rai, is one such property. The project offers 30 to 40 units for a monthly rent of Bt80,000-Bt90,000 per unit. Each unit has two-to-three bedrooms, and offers facilities such as a sauna, cable television, a swimming pool, cleaning services and security.
Perfect Masterpiece on Ekamai-Ram Indra, developed by Property Perfect, offers 17 units for rent at Bt65,000 to Bt100,000 a month depending on the size of the property and duration of the contract. Jones Lang LaSalle is the sole agent for the project.
Daonum said this project targets foreign executives who are looking for single houses with a convenient commute to Sukhumvit Road .
This project, built on 97 rai, has 167 single house units, which are available either in finished form or can be built to order.
The project is valued at Bt3.49 billion and units are available for sale at prices between Bt11 million and Bt57 million. Although the project offers only 17 units for rent, owners in the project are also offering houses for rent. The rental fee can be negotiated within the Bt60,000-to-Bt70,000 range if the contract is for more than two years.
The rental market targeting foreigners is a new alternative for investors to generate high returns.
Many major property developers have turned their focus more on the rental business. Landowners, who are unaware of how to generate value from their assets, should consider the rental business for investment as it holds great potential at the moment.
Source: Nation
Thursday, January 17, 2008
Developers say rules will cut profits
Green law will offset power use with trees
Proposed changes to environmental impact assessments (EIAs) relating to green space and air conditioning have raised concerns among condominium developers who fear lower profit margins. Teerachon Manomaiphibul, chief operating officer of the listed developer Property Perfect Plc, said the new proposed EIA measures require projects with more than 79 units to have one tree per tonne of British Thermal Unit (BTU) capacity of air-conditioning systems. He said the measure would increase costs by 10-20% due to limited space for unit development.
"Every new project faces this problem," he said. "Many need to revise plans by reducing units to have enough space to plant trees. This will increase prices per square metre or developers will need to have lower margins."
Since the new EIA measures were proposed last year, Property Perfect had to delay by three months the launch of a condominium on Ratchadaphisek Road. The company had to reduce the number of units from 1,750 to 900.
Meanwhile, to maintain a gross profit margin of 35%, the average price per square metre would have to be increased to 65,000 baht from 55,000 baht, said Mr Teerachon. The project would be launched by the second quarter of 2008.
"It's a trade-off for condominium buyers. If they buy a project that received EIA approval before new measures, they will pay lower prices.," he added.
Among other condominiums that faced delays were Noble Development's Noble Nano, with about 500 units on Pattanakarn Road.
Although the project opened for bookings in August of last year, the company needed to refund deposits to its customers and would re-launch the project during the second half of 2008.
Noble president Thongchai Busrapan said the EIA board suggested that any project with more than 100 units should receive EIA approval before selling units to customers to prevent a possible problem such as an adjustment in the plan.
New condominiums today have more limited space as some are located in prime areas with high land prices.
"The board should consider applying international standards that allow developers to plant the trees elsewhere like in the park or allow them to contribute money to environment-related organisations," Mr Thongchai said.
Mayta Chanchamcharat, chief executive officer of Plus Property Co, a subsidiary of Sansiri Plc, said condo developers this year might face lower margins due to expensive EIA measures.
Mr Mayta said the project's sellable area would fall but that developers might not be able to increase prices due to stiff competition. Thus, developers might absorb the cost by reducing gross margins.
Kittipol Pramoj Na Ayudhya, vice-president and secretary-general of the Thai Real Estate Association, said the new EIA measures would delay construction and unit transfers. This could cause buyers to delay their purchases.
Phatra Securities said the impact of the measures is already being felt since condominiums launched after last July do not yet have EIA approval.
Condominium developers need to buy additional land to meet the requirements. This has allegedly increased by 4-5% for high-rise projects in prime areas and 1%-3% for mid-rise projects in the suburbs or C+ areas.
There should not be any impact on property companies' earnings in 2008 given that projects scheduled for 2008 are approved and under construction. Developers may face losses of 2-6% in 2009 if they need to buy additional land.
Source: Bangkokpost by KANANA KATHARANGSIPORN
Proposed changes to environmental impact assessments (EIAs) relating to green space and air conditioning have raised concerns among condominium developers who fear lower profit margins. Teerachon Manomaiphibul, chief operating officer of the listed developer Property Perfect Plc, said the new proposed EIA measures require projects with more than 79 units to have one tree per tonne of British Thermal Unit (BTU) capacity of air-conditioning systems. He said the measure would increase costs by 10-20% due to limited space for unit development.
"Every new project faces this problem," he said. "Many need to revise plans by reducing units to have enough space to plant trees. This will increase prices per square metre or developers will need to have lower margins."
Since the new EIA measures were proposed last year, Property Perfect had to delay by three months the launch of a condominium on Ratchadaphisek Road. The company had to reduce the number of units from 1,750 to 900.
Meanwhile, to maintain a gross profit margin of 35%, the average price per square metre would have to be increased to 65,000 baht from 55,000 baht, said Mr Teerachon. The project would be launched by the second quarter of 2008.
"It's a trade-off for condominium buyers. If they buy a project that received EIA approval before new measures, they will pay lower prices.," he added.
Among other condominiums that faced delays were Noble Development's Noble Nano, with about 500 units on Pattanakarn Road.
Although the project opened for bookings in August of last year, the company needed to refund deposits to its customers and would re-launch the project during the second half of 2008.
Noble president Thongchai Busrapan said the EIA board suggested that any project with more than 100 units should receive EIA approval before selling units to customers to prevent a possible problem such as an adjustment in the plan.
New condominiums today have more limited space as some are located in prime areas with high land prices.
"The board should consider applying international standards that allow developers to plant the trees elsewhere like in the park or allow them to contribute money to environment-related organisations," Mr Thongchai said.
Mayta Chanchamcharat, chief executive officer of Plus Property Co, a subsidiary of Sansiri Plc, said condo developers this year might face lower margins due to expensive EIA measures.
Mr Mayta said the project's sellable area would fall but that developers might not be able to increase prices due to stiff competition. Thus, developers might absorb the cost by reducing gross margins.
Kittipol Pramoj Na Ayudhya, vice-president and secretary-general of the Thai Real Estate Association, said the new EIA measures would delay construction and unit transfers. This could cause buyers to delay their purchases.
Phatra Securities said the impact of the measures is already being felt since condominiums launched after last July do not yet have EIA approval.
Condominium developers need to buy additional land to meet the requirements. This has allegedly increased by 4-5% for high-rise projects in prime areas and 1%-3% for mid-rise projects in the suburbs or C+ areas.
There should not be any impact on property companies' earnings in 2008 given that projects scheduled for 2008 are approved and under construction. Developers may face losses of 2-6% in 2009 if they need to buy additional land.
Source: Bangkokpost by KANANA KATHARANGSIPORN
Wednesday, November 21, 2007
Jury still out on condotels
A new trend emerging in the Bangkok property market is the condo-hotel, and while such developments are seen as sound investments, the jury is out on whether people want to live in a place that has a ful-time hotel atmosphere.
Among the entrants in the segment is T.C.C. Capital Land, which last week announced plans for a resort-style condotel, North Park Place, located at the Rajapruek Golf Course on Vibhavadi Rangsit Road. HKR Asia-Pacific International, a subsidiary of HKR International in Hong Kong which owns the five-star Sukhothai Hotel, earlier announced plans for a high-end condominium attached to the hotel. Rajadamri Residence, a subsidiary of Minor International Plc, has also announced the construction of St Regis Hotel and Residence on Rajadamri Road near the Minor-owned Four Seasons Hotel.
Ian Soo, the managing director Hamptons Property, believes condotels would likely be more successful in resorts than in the capital because the units would be mostly rented out to holidaymakers who stay there only briefly.
A certain type of individual might choose a condotel as a permanent residence but that person would have to accept some trade-offs, he said. "A lot of people, if they're living there long-term, want a more homely atmosphere; you see other families in the lobby rather than businesspeople."
In a hotel lobby one has strangers checking in and out all the time whereas in a more natural setting one's neighbour might say hello and there would probably be children playing within the compound, Mr Soo said, adding that a hotel atmosphere is not always relaxing.
Looking at the general direction of the Bangkok condominium market, Mr Soo and branch manager Kleber Medeiros say that prices are unlikely to move dramatically over the next few months, unless some developers experience trouble, which may cause a panic.
"From the seller's side, I think prices have reached a good point if they are looking to realise value from their units from selling, I think this is certainly not a bad time to sell, prices have increased a great deal," said Mr Soo.
"From the buyer's side, there are some good-value units in the market as well. There is more supply than demand, so it's a buyer's market and they can pick up some great units at good prices. We would tell them, don't hesitate if you can get a good deal."
It is important to remember, he said, that supply-demand dynamics have changed. A lot of people who have bought condos are now trying to rent out or sell them but the number of buyers has not increased at the same level. "So there is this increasing gap _ the number of people who want to buy and sell _ and this is what is putting pressure on prices."
In the current buyers' and tenants' market, Mr Soo says people must carefully monitor what the market is doing in terms of pricing. "If you price yourself out of the market _ you know landlords have these figures in their heads, looking at 12 months previously or two years previously _ there's no point doing that. You have to look at prices now, if you want a tenant, price sensibly."
Where opportunities for speculators and retail investors are concerned, Mr Soo said this depends on the specific unit but generally the opportunities are rarer now. "It's important to differentiate between investment and speculation. Investment is generally a longer-term view, there are certainly opportunities for investment in terms of good rental yield and so on. Outright speculation, I think, is much more difficult now simply because prices have come under pressure so it's not easy to buy something and just flip it a few months later."
Mr Medeiros says speculation was still possible if one buys a unit in a good building and in a good location but this market is not as good as it used to be.
Over the last two months Hamptons has sold good units at Sky Villa, AP Citismart and The Met in Sathon. For rentals, all the new grade A buildings including The Legend, Domus, The Lakes, AP Citismart and Sky Villa are popular.
Mr Medeiros pointed out that the Skytrain and subway continue to be key factors in the condo market. Bangkok's first Bus Rapid Transit, due to open next July and run from the Chong Nonsi BTS station along Narathiwat Ratchanakrin and Rama III roads and then across the river to Ratchaphruek, will not be as much of a factor in his view. The main reason, he says, is that foreigners continue to prefer living in the centre of the city with Sukhumvit being the most popular area along with the Sathon, Silom, Ratchadamri and Lang Suan areas.
Mr Soo noted that the new bus system will help if it operates as planned but it is unlikely to have an effect on local property values. "I don't think it will make a great deal of difference."
Both Hamptons executives doubt whether the riverside will really pick up as a major expat area, especially in Thon Buri, even once Skytrain access is available. The fact remains, says Mr Soo, that anyone with a car would continue to face heavy traffic problems.
"The traffic situation is much more exaggerated here than in London, where everybody would love to live by the river because you have 20 roads coming in and out, so it's no problem. But here it's actually a bottleneck disaster," he said.
Bangkokpost: by NINA SUEBSUKCHAROEN
Among the entrants in the segment is T.C.C. Capital Land, which last week announced plans for a resort-style condotel, North Park Place, located at the Rajapruek Golf Course on Vibhavadi Rangsit Road. HKR Asia-Pacific International, a subsidiary of HKR International in Hong Kong which owns the five-star Sukhothai Hotel, earlier announced plans for a high-end condominium attached to the hotel. Rajadamri Residence, a subsidiary of Minor International Plc, has also announced the construction of St Regis Hotel and Residence on Rajadamri Road near the Minor-owned Four Seasons Hotel.
Ian Soo, the managing director Hamptons Property, believes condotels would likely be more successful in resorts than in the capital because the units would be mostly rented out to holidaymakers who stay there only briefly.
A certain type of individual might choose a condotel as a permanent residence but that person would have to accept some trade-offs, he said. "A lot of people, if they're living there long-term, want a more homely atmosphere; you see other families in the lobby rather than businesspeople."
In a hotel lobby one has strangers checking in and out all the time whereas in a more natural setting one's neighbour might say hello and there would probably be children playing within the compound, Mr Soo said, adding that a hotel atmosphere is not always relaxing.
Looking at the general direction of the Bangkok condominium market, Mr Soo and branch manager Kleber Medeiros say that prices are unlikely to move dramatically over the next few months, unless some developers experience trouble, which may cause a panic.
"From the seller's side, I think prices have reached a good point if they are looking to realise value from their units from selling, I think this is certainly not a bad time to sell, prices have increased a great deal," said Mr Soo.
"From the buyer's side, there are some good-value units in the market as well. There is more supply than demand, so it's a buyer's market and they can pick up some great units at good prices. We would tell them, don't hesitate if you can get a good deal."
It is important to remember, he said, that supply-demand dynamics have changed. A lot of people who have bought condos are now trying to rent out or sell them but the number of buyers has not increased at the same level. "So there is this increasing gap _ the number of people who want to buy and sell _ and this is what is putting pressure on prices."
In the current buyers' and tenants' market, Mr Soo says people must carefully monitor what the market is doing in terms of pricing. "If you price yourself out of the market _ you know landlords have these figures in their heads, looking at 12 months previously or two years previously _ there's no point doing that. You have to look at prices now, if you want a tenant, price sensibly."
Where opportunities for speculators and retail investors are concerned, Mr Soo said this depends on the specific unit but generally the opportunities are rarer now. "It's important to differentiate between investment and speculation. Investment is generally a longer-term view, there are certainly opportunities for investment in terms of good rental yield and so on. Outright speculation, I think, is much more difficult now simply because prices have come under pressure so it's not easy to buy something and just flip it a few months later."
Mr Medeiros says speculation was still possible if one buys a unit in a good building and in a good location but this market is not as good as it used to be.
Over the last two months Hamptons has sold good units at Sky Villa, AP Citismart and The Met in Sathon. For rentals, all the new grade A buildings including The Legend, Domus, The Lakes, AP Citismart and Sky Villa are popular.
Mr Medeiros pointed out that the Skytrain and subway continue to be key factors in the condo market. Bangkok's first Bus Rapid Transit, due to open next July and run from the Chong Nonsi BTS station along Narathiwat Ratchanakrin and Rama III roads and then across the river to Ratchaphruek, will not be as much of a factor in his view. The main reason, he says, is that foreigners continue to prefer living in the centre of the city with Sukhumvit being the most popular area along with the Sathon, Silom, Ratchadamri and Lang Suan areas.
Mr Soo noted that the new bus system will help if it operates as planned but it is unlikely to have an effect on local property values. "I don't think it will make a great deal of difference."
Both Hamptons executives doubt whether the riverside will really pick up as a major expat area, especially in Thon Buri, even once Skytrain access is available. The fact remains, says Mr Soo, that anyone with a car would continue to face heavy traffic problems.
"The traffic situation is much more exaggerated here than in London, where everybody would love to live by the river because you have 20 roads coming in and out, so it's no problem. But here it's actually a bottleneck disaster," he said.
Bangkokpost: by NINA SUEBSUKCHAROEN
Saturday, November 3, 2007
Premium riverfront sites offer long-term benefits
Bangkok, not unlike many other great cities around the world such as London or Shanghai, has grown up around a river _ the Chao Phraya River. For generations it has been the economic hub of trade and commerce with businesses and homes cropping up all along the waterway from its origins upstream in Nakhon Sawan.
Over the centuries it has inspired kings and queens, literary greats and architects who have created historical landmarks and cultural icons in the form of temples, palaces, teakwood houses and bridges along its banks.
Its importance for trade is undiminished as longtail boats and rice barges ply the famous channel as the river retains a buzz that is still very much in existence today.
The first international five-star hotels found their home on the banks of the Chao Phraya too, beginning with The Oriental to be joined by the likes of the Shangri-La, Royal Orchid Sheraton and The Peninsula more recently. They have been standard bearers for international hospitality and now it is the turn of international property developers to build on this progress and position Bangkok as a premium property investment proposition that has enormous underlying potential for growth.
The market this year has seen some interesting trends emerge, and these will continue to have a bearing on the riverside property market, an area that remains a busy location for developers representing 26% of new launches in the first half of this year.
The major change this year has been economic factors driving demand at the lower end of the market as housing affordability emerges as a key factor. Stable interest rates and lower pre-completion payments are key drivers of sales in that segment.
Demand in the higher end/luxury segment still appears cautious but has shown positive signs in the first half 2007. This segment is more attuned to levels of confidence in the market and Thailand's general economic outlook. An easing of currency volatility, along with the election in December and clear visibility in future mass-transport and infrastructure projects will be the major forces driving the upper-market segment forward.
Demand will continue to change over time, as preferences move toward condominiums rather than houses. Factors to consider will include close proximity to transport and retail facilities. Purchasers will look for more affordable units, perhaps smaller in size with efficient bedroom/bathroom/living spaces. When buying a property, purchasers should consider what they can afford, and invest in properties they would be willing to live in.
Currently, the best opportunities are in prime sites. These include existing prime areas in desirable inner-city locations, as well as emerging prime sites in new areas covered by future mass-transit systems. The risk attributed to existing and future prime sites is different _ existing prime sites are considered "blue chip", while newer sites are more speculative.
Bangkok still offers tremendous value compared to other regional and international property options, and with it, extremely strong underlying potential for growth. Prices of prime properties in Thailand are still a fraction of those in neighbouring countries. Hong Kong is selling prime properties for more than one million baht per square metre, Singapore for 600,000 to 750,000 baht per square metre. Shanghai and Dubai are now selling for well above 200,000 baht per square metre, having started at the same level as Bangkok in 2003.
Thailand property values, as well as the prices of stocks listed on the Stock Exchange of Thailand, have increased at a slower pace over recent years than those of its neighbours due to the uncertain political situation that has led to increased investor caution.
Once this uncertainty diminishes, we expect prices will begin to push up strongly. The jump could be significant, as we have already seen some developments looking at prices of 200,000 baht per square metre, while a year ago these would have sold for 100,000 baht.
The investment opportunities in condominium developments now, and certainly pre-election, are excellent. Prices are increasing, and are certainly expected to jump even more next year, with the best short- and long-term investment choices in prime areas.
Nigel Cornick is chief executive officer of Raimon Land Public Co Ltd, Thailand's leading international property developer with projects in Bangkok, Phuket and Pattaya. For more information visit www.raimonland.com
Source: NIGEL CORNICK (BangkokPost.com)
Over the centuries it has inspired kings and queens, literary greats and architects who have created historical landmarks and cultural icons in the form of temples, palaces, teakwood houses and bridges along its banks.
Its importance for trade is undiminished as longtail boats and rice barges ply the famous channel as the river retains a buzz that is still very much in existence today.
The first international five-star hotels found their home on the banks of the Chao Phraya too, beginning with The Oriental to be joined by the likes of the Shangri-La, Royal Orchid Sheraton and The Peninsula more recently. They have been standard bearers for international hospitality and now it is the turn of international property developers to build on this progress and position Bangkok as a premium property investment proposition that has enormous underlying potential for growth.
The market this year has seen some interesting trends emerge, and these will continue to have a bearing on the riverside property market, an area that remains a busy location for developers representing 26% of new launches in the first half of this year.
The major change this year has been economic factors driving demand at the lower end of the market as housing affordability emerges as a key factor. Stable interest rates and lower pre-completion payments are key drivers of sales in that segment.
Demand in the higher end/luxury segment still appears cautious but has shown positive signs in the first half 2007. This segment is more attuned to levels of confidence in the market and Thailand's general economic outlook. An easing of currency volatility, along with the election in December and clear visibility in future mass-transport and infrastructure projects will be the major forces driving the upper-market segment forward.
Demand will continue to change over time, as preferences move toward condominiums rather than houses. Factors to consider will include close proximity to transport and retail facilities. Purchasers will look for more affordable units, perhaps smaller in size with efficient bedroom/bathroom/living spaces. When buying a property, purchasers should consider what they can afford, and invest in properties they would be willing to live in.
Currently, the best opportunities are in prime sites. These include existing prime areas in desirable inner-city locations, as well as emerging prime sites in new areas covered by future mass-transit systems. The risk attributed to existing and future prime sites is different _ existing prime sites are considered "blue chip", while newer sites are more speculative.
Bangkok still offers tremendous value compared to other regional and international property options, and with it, extremely strong underlying potential for growth. Prices of prime properties in Thailand are still a fraction of those in neighbouring countries. Hong Kong is selling prime properties for more than one million baht per square metre, Singapore for 600,000 to 750,000 baht per square metre. Shanghai and Dubai are now selling for well above 200,000 baht per square metre, having started at the same level as Bangkok in 2003.
Thailand property values, as well as the prices of stocks listed on the Stock Exchange of Thailand, have increased at a slower pace over recent years than those of its neighbours due to the uncertain political situation that has led to increased investor caution.
Once this uncertainty diminishes, we expect prices will begin to push up strongly. The jump could be significant, as we have already seen some developments looking at prices of 200,000 baht per square metre, while a year ago these would have sold for 100,000 baht.
The investment opportunities in condominium developments now, and certainly pre-election, are excellent. Prices are increasing, and are certainly expected to jump even more next year, with the best short- and long-term investment choices in prime areas.
Nigel Cornick is chief executive officer of Raimon Land Public Co Ltd, Thailand's leading international property developer with projects in Bangkok, Phuket and Pattaya. For more information visit www.raimonland.com
Source: NIGEL CORNICK (BangkokPost.com)
Saturday, October 13, 2007
Starwood launches second 'W' location
Starwood Hotels & Resorts Worldwide Inc has announced the expansion of W Hotels worldwide with a plan to launch its second hotel, the W Bangkok in 2011.
Starwood has entered into a management agreement with North Sathorn Hotel Company, a joint venture between Istithmar Hotels FZE and Golden Land Property Development Plc for the new hotel. The property would form a major part of Golden Land's Sathorn Square mixed-use development.
The 400-room W Bangkok would be located on the former Russian Embassy site on Sathon Road, that would also comprise Infinity Condominium and 70,000 square metres of grade A office space with luxury boutiques and shops.
"We are thrilled with the introduction of the W brand into Bangkok. Following the announcement of W Retreat & Residences, Koh Samui, the W Bangkok is a logical extension of W's dynamic growth in Thailand," said Miguel Ko, president of Starwood Hotels & Resorts, Asia Pacific.
The 400-room W hotel will be part of a mixed-use development at the former Russian Embassy site.
Joe Sita, chief executive of Istithmar Hotels, said the prime site in the heart of Bangkok deserved a world-class brand to operate the hotel.
"The W Bangkok is our second W Hotels property in Thailand and I believe it will complement ideally our first project, the W Retreat & Residences in Koh Samui, which is also currently under development," he said.
Istithmar Hotels is expanding its operations across the world. "Southeast Asia is a strategically important region, with Bangkok being one of our key target markets. We continue to look for projects that offer us the right balance between risk and rewards," said Mr Sita.
W Hotels is a global brand with 21 properties in the around the world. W Hotel recently announced plans to open properties in Barcelona, Istanbul, Athens, Hong Kong, Shanghai, Koh Samui, Santiago, Dubai, Doha and Macau.
Istithmar PJSC is the investment company of Dubai World. It has an investment portfolio that includes more than 50 companies. Its real estate business aims to acquire and manage a diversified portfolio in commercial property, hotels and resorts, the leisure and retail sectors.
Source: BangkokPost.com
Starwood has entered into a management agreement with North Sathorn Hotel Company, a joint venture between Istithmar Hotels FZE and Golden Land Property Development Plc for the new hotel. The property would form a major part of Golden Land's Sathorn Square mixed-use development.
The 400-room W Bangkok would be located on the former Russian Embassy site on Sathon Road, that would also comprise Infinity Condominium and 70,000 square metres of grade A office space with luxury boutiques and shops.
"We are thrilled with the introduction of the W brand into Bangkok. Following the announcement of W Retreat & Residences, Koh Samui, the W Bangkok is a logical extension of W's dynamic growth in Thailand," said Miguel Ko, president of Starwood Hotels & Resorts, Asia Pacific.
The 400-room W hotel will be part of a mixed-use development at the former Russian Embassy site.
Joe Sita, chief executive of Istithmar Hotels, said the prime site in the heart of Bangkok deserved a world-class brand to operate the hotel.
"The W Bangkok is our second W Hotels property in Thailand and I believe it will complement ideally our first project, the W Retreat & Residences in Koh Samui, which is also currently under development," he said.
Istithmar Hotels is expanding its operations across the world. "Southeast Asia is a strategically important region, with Bangkok being one of our key target markets. We continue to look for projects that offer us the right balance between risk and rewards," said Mr Sita.
W Hotels is a global brand with 21 properties in the around the world. W Hotel recently announced plans to open properties in Barcelona, Istanbul, Athens, Hong Kong, Shanghai, Koh Samui, Santiago, Dubai, Doha and Macau.
Istithmar PJSC is the investment company of Dubai World. It has an investment portfolio that includes more than 50 companies. Its real estate business aims to acquire and manage a diversified portfolio in commercial property, hotels and resorts, the leisure and retail sectors.
Source: BangkokPost.com
Sunday, September 30, 2007
TCC Land plans huge expansion Developer to invest Bt10 bn a year
TCC Land, the property arm of liquor tycoon Charoen Sirivadhana-bhakdi, is planning an aggressive investment programme over the next five to 10 years.
It will join with foreign partners to pour Bt10 billion a year into different types of property developments.
CEO Wallapa Traisorat - a daughter of Charoen - said that to become an integrated property firm, TCC Land would set up joint ventures with four strategic partners - from the US, the Netherlands and Singapore - to develop different types of properties from the Sirivadhanabhakdi family's land bank. The family's land bank has properties in many provinces.
The first new business will be called Premium Outlet. It will develop a retail and residential project on about 8 hectares of land on Kaset-Nawamin Road - part of an 80-hectare plot owned by the family. For this project, the company will form a joint venture with Premium Outlet of the US, which has branches in Japan and South Korea, as well as its home base. Contracts will be signed this year, Wallapa said.
The second deal involves a joint venture with a Dutch property firm to develop a 1,600-hectare land plot in Cha-am district of Phetchaburi province as a residential project. Original plans were to locate a Disney theme park on the property, but TCC Land has changed its plans. Another site has been found for the Disney park.
"We continue to keep contact with Disneyland, but we think the Cha-am location is not suitable for the theme-park concept, and as a result we'll change to another area for this project," Wallapa said.
The third joint venture will involve a Singaporean firm that is expert in the logistics business. It will develop a logistics system for the entire business interests of the Sirivadhanabhakdi family.
Currently, Thai Beverage and Berli Jucker both have their own logistics systems to deliver their products. However, the companies believe the group's land and transport resources are sufficient for the development of a single logistics network to serve demand throughout the Kingdom. As a result, TCC Land plans to expand its business interests to cover logistics systems, she said.
The fourth joint venture will involve another Singaporean firm that is expert in the business of industrial estates, and plans are afoot to develop family land in Rayong province as a new industrial estate.
Wallapa said under the company's strategy, TCC Land would own as much as half of each joint venture. It expects the new joint ventures to make combined investments totalling Bt10 billion a year until the business plans are complete. Half of this will come from TCC Land, she said.
"We entered the property business in 2001, and we believe we're now strong and confident enough to expand our business to become an integrated property developer. This will combine residential projects, office buildings, retail business, hotels and resorts, warehouses, logistics, convention centres, theme parks and industrial estates," she said.
As a matter of business policy, TCC Land has taken on new projects only after finding strategic partners with strong experience in project development.
Earlier, it joined Singaporean firm CapitaLand to establish TCC Capital Land, which has developed eight residential projects in Bangkok, both condominiums and detached housing, worth up to Bt20 billion. They are Athenee Residence, Villa Rachahru, Villa Sathorn, Villa Ratchadumri, North Park Place, The Empire Place, The Emporio Place and Royal Residence.
The Royal Residence won Thailand Best Interior Design and Thailand Best Property awards at the International Property Awards 2007, announced in London. Athenee Residence has also won four star awards from Thailand Best Development.
TCC Capital Land expects total revenue of Bt4 billion this year and Bt8 billion next year. It plans to launch four new residential projects next year worth as much as Bt8 billion.
TCC Land has also signed a contract with US-based Starwood to manage its 10 hotels in Thailand and China. Construction of three of them, located in China and on Koh Samui, is now complete, and they are ready to operate. The next three are under construction in Thailand, and construction will start on the final four between next year and 2010. Investment in the Bangkok, Koh Samui and China hotels amounts to Bt10 billion.
Meanwhile, the company is negotiating with the Treasury Department to renew its contract to manage the Queen Sirikit National Convention Centre.
"We believe that when we have good partners who have strong experience and are ready to help our business plans, then we'll achieve our goals. But we have to take time to find the best partners," Wallapa said.
At present, TCC Land manages property worth up to Bt100 billion throughout Thailand.
Source: The Nation - www.nationmultimedia.com
It will join with foreign partners to pour Bt10 billion a year into different types of property developments.
CEO Wallapa Traisorat - a daughter of Charoen - said that to become an integrated property firm, TCC Land would set up joint ventures with four strategic partners - from the US, the Netherlands and Singapore - to develop different types of properties from the Sirivadhanabhakdi family's land bank. The family's land bank has properties in many provinces.
The first new business will be called Premium Outlet. It will develop a retail and residential project on about 8 hectares of land on Kaset-Nawamin Road - part of an 80-hectare plot owned by the family. For this project, the company will form a joint venture with Premium Outlet of the US, which has branches in Japan and South Korea, as well as its home base. Contracts will be signed this year, Wallapa said.
The second deal involves a joint venture with a Dutch property firm to develop a 1,600-hectare land plot in Cha-am district of Phetchaburi province as a residential project. Original plans were to locate a Disney theme park on the property, but TCC Land has changed its plans. Another site has been found for the Disney park.
"We continue to keep contact with Disneyland, but we think the Cha-am location is not suitable for the theme-park concept, and as a result we'll change to another area for this project," Wallapa said.
The third joint venture will involve a Singaporean firm that is expert in the logistics business. It will develop a logistics system for the entire business interests of the Sirivadhanabhakdi family.
Currently, Thai Beverage and Berli Jucker both have their own logistics systems to deliver their products. However, the companies believe the group's land and transport resources are sufficient for the development of a single logistics network to serve demand throughout the Kingdom. As a result, TCC Land plans to expand its business interests to cover logistics systems, she said.
The fourth joint venture will involve another Singaporean firm that is expert in the business of industrial estates, and plans are afoot to develop family land in Rayong province as a new industrial estate.
Wallapa said under the company's strategy, TCC Land would own as much as half of each joint venture. It expects the new joint ventures to make combined investments totalling Bt10 billion a year until the business plans are complete. Half of this will come from TCC Land, she said.
"We entered the property business in 2001, and we believe we're now strong and confident enough to expand our business to become an integrated property developer. This will combine residential projects, office buildings, retail business, hotels and resorts, warehouses, logistics, convention centres, theme parks and industrial estates," she said.
As a matter of business policy, TCC Land has taken on new projects only after finding strategic partners with strong experience in project development.
Earlier, it joined Singaporean firm CapitaLand to establish TCC Capital Land, which has developed eight residential projects in Bangkok, both condominiums and detached housing, worth up to Bt20 billion. They are Athenee Residence, Villa Rachahru, Villa Sathorn, Villa Ratchadumri, North Park Place, The Empire Place, The Emporio Place and Royal Residence.
The Royal Residence won Thailand Best Interior Design and Thailand Best Property awards at the International Property Awards 2007, announced in London. Athenee Residence has also won four star awards from Thailand Best Development.
TCC Capital Land expects total revenue of Bt4 billion this year and Bt8 billion next year. It plans to launch four new residential projects next year worth as much as Bt8 billion.
TCC Land has also signed a contract with US-based Starwood to manage its 10 hotels in Thailand and China. Construction of three of them, located in China and on Koh Samui, is now complete, and they are ready to operate. The next three are under construction in Thailand, and construction will start on the final four between next year and 2010. Investment in the Bangkok, Koh Samui and China hotels amounts to Bt10 billion.
Meanwhile, the company is negotiating with the Treasury Department to renew its contract to manage the Queen Sirikit National Convention Centre.
"We believe that when we have good partners who have strong experience and are ready to help our business plans, then we'll achieve our goals. But we have to take time to find the best partners," Wallapa said.
At present, TCC Land manages property worth up to Bt100 billion throughout Thailand.
Source: The Nation - www.nationmultimedia.com
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