Q1 2012 | Condominium
thailand
Bangkok Condominium Market REPORT Bangkok Condominium Market HIGHLIGHTS New launches in Q1 2012 dramatically increased from Q4 2011, highest in the past four quarters. Within urban Bangkok, the Northern Fringes led the way in new launches with around 20% of the whole of Bangkok. The Suburban area accounted for around 39% of the total.
market indicators Q4 2011 - Q1 2012
There were around 2,850 units of new supply in Q1 2012, a significant decrease from the previous quarter. Since the first quarter of 2011 until Q1 2012, the number of new condominium supply completed and registered keeps decreasing. The floods last year caused much potential for condominium projects in the city area because there is no flood in the city and it is more convenient to commute.
new Supply LAUNCHES PRICES
Newly launched condominium units during the year 2011 –Q1 2012 by quarter
TAKE-UP
Source: Colliers International Thailand Research
New launches for Q1 2012 increased significantly compared to the previous quarter by approximately 9,000 units. More than 14,170 units were launched in Q1 compared to around
www.colliers.co.th
5,157 units in Q4 2011. Some projects affected by the flood in Q4, 2011 postponed their launch to Q1, 2012. This was the highest number recorded in the past five quarters.
Bangkok condominium Market REPORT | Q1 2012 Newly launched condominium units in Q1 2012 by location
Source : Colliers International Thailand Research
Most new projects launched in the first quarter or nearly 8,700 units were -in Urban Bangkok.
total being backed-up by a large-scale project, Suphalai Wellington. The Outer City - East area was second, with 2,200 units.
Amongst this number, the Northern Fringe area in urban Bangkok showed the highest numbers with nearly 3,000 units or 20% from the
Additional Supply by Quarter
Source: Department of Land, Colliers International Thailand Research Remark: The number of units does not include projects from the National Housing Authority
Reports show approximately 2,900 new condominium units completed and registered at the Department of Land in Q1 2012. The total number of units in the entire Bangkok region was approximately 326,700 units
COLLIERS INTERNATIONAL | P. 2
out of which more than39,500 units are scheduled to be completed in 2012.
Bangkok condominium Market REPORT | Q1 2012 Total Historical Supply by Location to Q1 2012
Source: Department of Land, Colliers International Thailand Research
There are more than 195,000 condominium units or around 65% of the total, located in Suburban Bangkok area as well. Within the urban Bangkok area, the Northern Fringe contains the most number of units because of its proximity to the city centre, mass transit connections and
relatively lower land prices compared to the City area. The Outer City areas are appearing on the radar screen too because of the extension of the BTS across the Chao Phraya River and along Sukhumvit Road. This is set to continue.
COLLIERS INTERNATIONAL | P. 3
Bangkok condominium Market REPORT | Q1 2012 Future Supply – Urban Bangkok Cumulative future supply scheduled to be completed during 2012 – 2014 by location in urban Bangkok (as of Q1 2012)
Source: Colliers International Thailand Research Remark: Supply does not included units in Suburban Bangkok
Approximately 30,894 units are scheduled to be completed in 2012. The Northern Fringe area continues as key player in urban Bangkok, with nearly 11,800 units scheduled to – complete in 2012, followed by the City
area with around 6,200 units. It is expected that the Northern Fringe will continue to dominate the supply for the early part of the decade in urban Bangkok.
Take-up Average sales proportion of newly launched units in Q1 2012 by location
Source: Colliers International Thailand Research
The take-up rate in the Outer City - West area is the highest, followed by the Suburban Bangkok and Eastern Fringe areas. The positive figures for the Outer City - West are the result of a popular newly launched
COLLIERS INTERNATIONAL | P. 4
project from Ananda Development. Many buyers are postponing their decisions from last year to this quarter, so the average take-up rate - this quarter will most likely be higher than in the previous quarter.
Bangkok condominium Market REPORT | Q1 2012 Launches with high take-up rates in Q1 2012 KPN Group Corporation Ltd launched a new project on Petchburi Road in the first quarter of 2012, The Capital Ekamai – Thonglor. Although there is high competition in the condominium market on Petchburi Road, _The Capital Ekamai – Thonglor was sold out within a month. The project offers high quality product, good design and great facilities as well as value for money to attracted buyers and thus, was sold out within a short period.
Ananda Development returned to the condominium market with IDEO MOBI launching four projects in four different locations at the same time. All of the IDEO MOBI projects had a high take-up rate of more than 80% shortly after the initial launch. The great selling point of the IDEO brand is location as all of the IDEO projects are close to the BTS or MRT stations. City Resort Ratchada – Huaykwang by Supalai Plc. launched its new project on Pracharatbampen Road that resulted in a positive take-up rate of more than 80% of the 875 units. The attraction was the starting price which was approximately THB48,000 per sq m.
HQ Thonglor by Sansiri has shown an great performance in 1Q 2012, selling 197 units in one day The project is located on Thonglor Road in the City area. Many of the units are one-bedroom of around 40.5 - 55.5 sq m. Some are duplex.
Average Selling Prices of Newly Launched Projects by Location, Q1 2012
Source : Colliers International Thailand Research
The highest average price in the City area is more than THB113,500 per sq m, however this is still lower than the average selling price in 2011 by approximately 5%. because most newly launched projects in the City
area now are located further from the BTS The average selling price in the Outer City - West area seconds because new projects in this area are located only a walking distance from the BTS station.
COLLIERS INTERNATIONAL | P. 5
Bangkok condominium Market REPORT | Q1 2012 Mass Transit Effect Take-up rate of newly launched projects by proximity to existing mass transit lines, Q1 2012
Source: Colliers International Thailand Research
The take-up rate of projects less than 200 metres from the BTS / MRT systems was the highest, at around 70%. Projects 501 - 1,000 metres from the mass transit system had the lowest take-up rate, because
although the projects are quite far from BTS / MRT lines, the selling prices of some projects were similar to other projects located less than 500 metres from the mass transit line.
Average Selling Prices of Newly Launched Projects by Proximity to Existing Mass Transit Lines, Q1 2012
Source: Colliers International Thailand Research
The average selling price of projects less than 200 metres from BTS / MRT lines is the highest and higher than other locations by 3 - 79%. While the average selling price of projects located 1 km away from the
COLLIERS INTERNATIONAL | P. 6
mass transit lines is approximately THB51,200 per sq m, higher than the previous quarter by approximately 6%.
Bangkok condominium Market REPORT | Q1 2012
Cumulative Condominium Units Launched Along the BTS Extension Line (The Blue Line) from Before the Year 2005 to 2011 on the Main Road
Source : Colliers International Thailand Research
During the last quarter of 2006 the government announced official plans for five mass transit extension lines, starting with the construction of the Purple and Blue Lines in 2009 and 2011, respectively. The Purple Line will start from Bang Sue Station and run to Nonthaburi. The Blue Line to western Bangkok will have two extension lines, the first starting from Bang Sue Station and the second starting from Hua Lamphong Station. The Thapra Station will be the terminus, but one line will continue on to Bangkae along Phetkasem Road. Many condominium projects were launched along the Blue Line during the past six years, especially on Phetkasem, Charansanitwong, Boromarajonani and other roads inter-connecting with these main roads. Nearly 86% of the total supply launched since 2009 - 2011 along the line were developed by listed companies.
The average take-up rate of projects along this line is more than 70%, especially those on Pracharat 1 and 2 Roads, Phetkasem, Boromarajonani and Charansanitwong Roads. This is because most people from the western side of the Chaopraya River work in the City area as needs more comfort in travelling to work in order to save time. Mass transit remains a key factor in attracting developers and buyers. However, the closer it is to the City the better as most residential projects on the outskirts of Bangkok are low-rise housing projects selling as similar prices as condominiums. Some buyers do prefer buying houses when compared to a condominium unit.
COLLIERS INTERNATIONAL | P. 7
Bangkok condominium Market REPORT | Q1 2012 Financing Housing Loans for Personal Consumption Extended by Financial Institutions
Source: Bank of Thailand and Colliers International Thailand Research Note: Excludes negligible amounts of financing from other sources. Percentage change is comparable quarter-on-quarter.
The growth rate of housing loans increased only 0.7% from Q3 – Q4 2011 due to the flooding in Thailand. The first home mortgage policy launched by the government in Q3, 2011 did not attract buyers to purchase and transfer residential units. It was -far below the target of
COLLIERS INTERNATIONAL | P. 8
THB20 billion set for the whole project expiring at the end of 2011 Moreover, it didn’t match the demand of the market hence the Ministry of Finance intends to revise the first-home mortgage policy once again.
Bangkok condominium Market REPORT | Q1 2012 Forecast As a result of flooding in the last quarter of 2011, most developers in Bangkok are focusing more in the first half of 2012 tn launch new projects with a variety of marketing campaigns to attract buyers. The flooding also increased condominium demand in the urban Bangkok area as it is more convenient for victims to commute. The new Bangkok Town Plan remains a major concern for developers as most of them including the e three main real estate associations in Thailand oppose to the new town plan. The reason being that the latest draft of the new Bangkok Town Plan includes a regulation against building higher than 23 metres or bigger than 10,000 sq m on roads that are narrower than 16 metres. Most roads and sois in Bangkok are narrower than 16 m, therefore, if these new town plans are released in the future, developers cannot build high-rise condominium projects on
land in small roads and sois of Bangkok which will also directly affect land prices. The Department of City Planning Bangkok Metropolitan administrator has still not finalised the new Bangkok Town Plan in the first quarter of 2012 as there has been many complaints from developers, landowners, and people to be affected by the new Town Plan. Large, listed developers with a strong reputation dominate the condominium market and they are focusing more on the middle- to lowend market outside the urban Bangkok area. Most of the demand in Bangkok is for affordable condominium units with a selling price of less than THB3 million and all developers continue to target this group in 2012.
COLLIERS INTERNATIONAL | P. 9
Bangkok condominium Market REPORT | Q1 2012
APPENDIX
COLLIERS INTERNATIONAL | P. 10
Bangkok condominium Market REPORT | Q1 2012 ZONING HISTORICAL SUPPLY BY YEAR
cumulative supply in Bangkok
COLLIERS INTERNATIONAL | P. 11
Bangkok condominium Market REPORT | Q1 2012 • CITY AREA The area covers four adjacent but competing sub-markets: the Sukhumvit section comprising Sukhumvit Road between Soi 1 and Soi 55 to the north and Soi 2 and Soi 38 to the south; the Central Lumpini section including Phloen Chit Road, Rama I Road, Soi Langsuan, Soi Sarasin, Chitlom Road, Ratchadamri Road, Witthayu Road and Rachaprasong Road; the Silom / Sathorn section; and the Riverside section fronting the Chao Phraya River along Charoenkrung Road and Charoennakorn Road, where several five-star hotels are located. The City area is convenient for businesspersons, expatriates and tourists, because of its proximity to many office buildings, retailing and local attractions.
• CITY FRINGE AREA This area covers three parts of Bangkok: Northern Fringe: This section covers the BTS route starting from Ratchathewi Station to Mo Chit Station to the north and the MRT route starting from Petchaburi station to Bangsue station to the north. Southern Fringe: This section covers Narathiwad Ratchanakarin Road, Chan Road, Sathupradit Road, Charoenkrung Road and Rama III Road along the Chao Phraya River. Eastern Fringe: This section covers the BTS route starting from Thong Lor Station to On Nut Station to the east, Rama IV Road and Petchaburi Road.
COLLIERS INTERNATIONAL | P. 12
This area covers locations with their own local infrastructure and convenient transportation. However, commuting is required to have access to the central business and entertainment areas.
• OUTER CITY AREA The area covers two parts of Bangkok: Outer City (East): This section starts from the extension of the BTS route at On Nut Station to the Bangkok boundary to the east. Outer City (West): This section starts from the extension of the BTS route at Taksin Station to Bang Wa station, which includes the area from Krung Thonburi Road to Ratchaphruek Road near Petchakasem intersection.
• SUBURBAN BANGKOK These are the environs outside the areas already mentioned. Expansion of the mass transit system is the main determinant for increasing future supply in a particular area. The expansion from On Nut to Samut Prakarn is scheduled to be completed in 2011. The expansion of the BTS will benefit directly the surrounding condominiums, as it will considerably reduce transportation costs and time. This will encourage the development of new condominiums in this area. Suburban Bangkok represents the biggest area and for the purposes of this report and includes Bangkok city’s old town (Koh Rattanakosin area and boundary area). This location has comprehensive town planning controls restricting building height, so there are no condominium projects in the area.
Bangkok condominium Market REPORT | Q1 2012 COLLIERS INTERNATIONAL THAILAND MANAGEMENT TEAM PROJECT SALES & MARKETING Monchai Orawongpaisan | Senior Manager RESIDENTIAL SALES & LEASING Napaswan Chotephard | Manager RESEARCH Tony Picon | Associate Director Surachet Kongcheep | Senior Manager OFFICE & INDUSTRIAL SERVICES Narumon Rodsiravoraphat | Associate Director RETAIL SERVICES Asharawan Wachananont | Associate Director ADVISORY SERVICES | HOSPITALITY Jean Marc Garret | Director ADVISORY SERVICES Napatr Tienchutima | Associate Director REAL ESTATE MANAGEMENT SERVICES Prasert Saiphrawan | Senior Manager INVESTMENT SERVICES Nukarn Suwatikul | Associate Director Wasan Rattanakijjanukul | Senior Manager VALUATION & ADVISORY SERVICES Phachsanun Phormthananunta | Director Wanida Suksuwan | Manager
522 offices in 62 countries on 6 continents • A leader in real estate consultancy worldwide • 2nd most recognized commercial real estate brand globally • 2nd largest property manager • 1.25 billion square feet under management • Over 12,300 professionals
COLLIERS INTERNATIONAL Thailand: Bangkok Office 17/F Ploenchit Center, 2 Sukhumvit Road, Klongtoey, Bangkok 10110 Thailand tel +662 656 7000 FAX +662 656 7111 Email info.th@colliers.com Pattaya Office 519/4-5, Pattaya Second Road (Opposite Central Festival Pattaya Beach), Nongprue, Banglamung, Chonburi 20150 tel +6638 427 771 FAX +6638 427 772 Email info.pattaya@colliers.com Hua Hin Office 27/7, Petchakasem Road, Hua Hin, Prachuap Khiri Khan 77110 Thailand tel +6632 530 177 FAX +6632 530 677 Email info.huahin@colliers.com
PATTAYA OFFICE Mark Bowling | Senior Sales Manager Supannee Starojitski | Senior Business Development Manager / Office Manager HUA HIN OFFICE Sunchai Kooakachai | Senior Manager
researcher: Thailand Surachet Kongcheep Senior Manager | Research email surachet.kongcheep@colliers.com
This report and other research materials may be found on our website at www.colliers.co.th. Questions related to information herein should be directed to the Research Department at the number indicated above. This document has been prepared by Colliers International for advertising and general information only. Colliers International makes no guarantees, representations or warranties of any kind, expressed or implied, regarding the information including, but not limited to, warranties of content, accuracy and reliability. Any interested party should undertake their own inquiries as to the accuracy of the information. Colliers International excludes unequivocally all inferred or implied terms, conditions and warranties arising out of this document and excludes all liability for loss and damages arising there from. Colliers International is a worldwide affiliation of independently owned and operated companies.
Accelerating success. www.colliers.co.th