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Volume 10 issue 3 January 2013
Volume 10 Issue 3 January 2013
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f you invest in property in South East Asia, one of the most critical parts of the process is to exchange your own currency (perhaps US dollars or UK pounds) into that of the local region. If you want to buy in Thailand for instance, you must first purchase Thai baht. Given that, the strength of these South East Asian currencies can have a big impact on your investment. If the Singapore dollar weakens, for example, then property there becomes cheaper for foreign investors. And if the Singapore dollar climbs, it’s the opposite.
With that in mind, we at Pure FX have compiled a brief overview of how the main South East Asian currencies have performed in the past month. The idea is that, you can read the update, and it leaves you in a better position when you exchange currencies. Singapore dollar (SGD) The Singapore dollar has risen almost a cent against the US dollar in the last eight weeks, from 0.8136 on October 5th to 0.8204 at the time of writing. This reflects the fact that, with inflation high at 4.5 percent in Singapore, the island’s Monetary Authority is eager to let its currency rise, to mitigate this impact. If the Singapore dollar is higher, then imported goods will fall in price, leading to less inflationary pressure. In addition, the US Fed’s policy of unlimited quantitative easing is bringing huge investment inflows into Singapore, also taking the local dollar higher. Thai baht (THB) The Thai baht has stood virtually unchanged against the US dollar in the last eight weeks, moving from 0.0327 against the greenback on October 5th to just 0.0326 today. This reflects considerable umming and aahing among investors, concerning Thailand’s economic prospects for 2013. On the one hand, the economy expanded three percent in the third quarter compared to a year ago, which looks positive. But with 2011’s floods skewing statistics, it’s hard to say if this is up to snuff or not, creating uncertainty about Thailand’s prospects for next year. Hence, the unchanged baht. Japanese yen (JPY) The yen has sunk against the US dollar in the
last two months, falling from 0.0127 on October 5th to 0.0122 today. In fact, this is the yen’s lowest point against the US dollar since April. Why is this? Well, it reflects a deeply negative opinion about Japan’s economy and future prospects. Fiscal policy is seen as ineffectual, with national debt at more than 200 percent of GDP, while the Bank of Japan is about to be completely overhauled. Given that, investors are shorting the yen in record numbers, and the odds of the currency continuing to fall are high. Indian rupee (INR) The Indian rupee has fallen against the US dollar in the past eight weeks, slipping from 0.0193 on October 5th to 0.0184. This reflects the fact that India’s economy expanded at the slowest pace since the first three months of 2009, between July and September, growing just 5.3 percent year on year (YoY.) Given that, there are concerns that, “If the government does not take any policy actions, the growth outlook could remain ominous,” as Samiran Chakraborty at Standard Chartered Bank notes. Of course, that could see the rupee fall further.
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he Nation forecasts a positive outlook for the New Year in Thailand, with high demand for residential housing predicted to continue.
As anticipated by The Nation, presales for the top seven Thai property developers dropped by 11 percent in the third quarter of 2012, to a total of THB39.6 billion (US$1.29 billion). By the end of September this year however, developers had seen a 23 percent rise on total sales year on year, with a total of THB124.2 billion (US$4.05 billion) in presales transactions, making up 77 percent of developers’ targets for that point in the year. With an increasing number of property launches and higher weighting towards condominiums, it is predicted that presales will increase in the final quarter of 2012. Due to their moderate forecasts, The Nation anticipates that there will be an upside risk for the presales of developers Asian Property, Land Houses and L.P.N Development, in addition to higher demand than originally anticipated. The Nation predicts Pruksa Real Estate is expected to meet its estimate target, while Sansiri and Supalai ought to achieve their twice revised targets of THB40 billion (US$1.3 billion, up 84 percent year on year) and THB19 billion (US$620 million, up 38 percent year on year).
The Nation also expects demand for residential property is also expected to increase in Thailand’s provinces. While demand for residential properties in Bangkok and the city’s vicinity is anticipated to increase at a normal rate of five to ten percent in 2013, demand for developer-built housing is expected to experience a much greater growth. This is due to urbanisation, for as the urban population and income increase, so does the demand for property, and developerbuilt houses in particular. According to The Nation, it is from this sector that developers can expect primary growth in the future. With most major development companies already having a substantial presence outside of Bangkok and Asian Property launching their first provincial project next year, exposure of all developers in the provinces is expected to rise. The Nation predicts that the developers to watch in 2013 are Quality Houses, Sansiri and Asian Property based on operational turnaround, cheap valuation and evidence of positive growth.
Also deemed noteworthy by The Nation in Thailand’s anticipated 2013 real estate climate, is the likelihood that the Bank of Thailand will keep its interest rate low in order to boost the economy. However, it is not predicted that this will encourage strong demand in the housing sector, with a study by The Nation showing weak correlation between interest rates and housing demand.
An additional factor expected by The Nation to influence the demand for residential housing in Thailand is the introduction of a new government measure on 1 January 2013, that stipulates loan-to-value for low-rise houses with prices below THB10 million (US$326,530) per unit will be limited at 95 percent, where there was previously no limit at all. It is forecast that this measure will have little impression on demand as many Thais will have savings, and in some cases banks will still lend 100 percent of the property price. The expiration of several government stimulus measures that include a tax refund for first time buyers, soft loan for flood victims and three-year 0 percent mortgage rate for first time buyers are predicted to cause few ripples in the housing market.
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Volume 10 issue 3 January 2013
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Volume 10 issue 3 January 2013
Green buildings-A sustainable choice
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ith the recognition of the need to save the environment from getting more polluted, people are shifting towards the eco-friendly substitutes of anything and everything. Not only the government and scientists but the common people have also realized their responsibility to make the environment as pollution free as possible to order to lead a healthy existence. People are becoming more conscious and the standards are being marked for the quality check of every product so that the environment does not get harm by any of the pollutant means. Thus, the buildings are also being constructed in the green way so that the material being used in the construction process does not affect either the environment or the people residing in it.
Growing awareness
With the rising trend of eco-friendly buildings and towns, the focus is to make not only the newly constructed buildings green but also to bring the already existing buildings in the ‘eco-friendly’ hub so that the entire world could be made pollution free. Though it might not seem to be feasible, the experiments are being carried out and many options are being considered which can help to make the old buildings as much environmental friendly as possible by integrating them with the green components.
The people worldwide have become more careful about the surroundings they live in and thus making every possible contribution in order to make their existence better by going green in everything including their buildings. They have become more aware about the quality and the level of standard of the products they chose rather than just going by the look of the house, which has helped to cope up with the environmental degradation to some extent.Image courtesy:indiacube.com
Making the existence green
People are becoming more familiar and alarming about the rising issues which could endanger their existence. For instance, the problems of water shortage as well as water flooding have been recognized in some of the areas of the world. Hence, the environmental friendly buildings are being structured in such a manner that they can be useful in the rain water harvesting process in areas where there is shortage and can allow the continuous flow of the water in a very systematic manner in the areas where the risk of flooding has been predicted. The thing which has resulted in this growing trend is the increasing environmental problems that are being discussed among the common public more these days.
Bangkok Office Hit 1,000 Baht Per Sq.m
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ast month, office rents spiked for the first time ever in the history of Bangkok, to over THB 1,000 per square metre per month, according to leading international property consultant CBRE Thailand. Although this was, for now, only a single transaction and for a fully furnished office, this is indicative of the rapid improvement in Bangkok’s office market in the last quarter. The two leading grade A buildings, Park Ventures Ecoplex and Sathorn Square, are now close to full. Although space is still available at both properties today, users requiring larger spaces are close to making binding commitments, which will take occupancy at both buildings to well above 90%, possibly filling all the remaining space. This changes the dynamics of the office market and, for large tenants seeking contiguous floors in modern grade A buildings, space can now only be taken as a result of future vacancies. More significantly, landlords are not under pressure at this time to agree to concessions or to negotiate discounts for individual tenants as they are not critical to
their overall income stream. In fact, many landlords will be raising rents on renewals in line with the latest open market rents. Out of the 26 buildings in the Bangkok’s central business district (CBD) that CBRE classifies as being grade A, eleven are already 100% occupied and the rest are nearly all at least 90% occupied. “Lack of choice and limited availability of space are also becoming pronounced factors in the market and we have the following advice to give office tenants,” said Mr. David Simister, Chairman of CBRE
NOBLE PLANS NEW PROJECTS WORTH OVER BT7bn FOR 2013
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oble Development announced a plan to launch at least three new high end condominium projects in the first half of 2013 with a total value of over Bt7 billion on Bangkok’s CBD – Ratchadapisek, Thong Lor and Sukhumvit. Noble Ploenchit Project has also made impressive progress with good sales and completion scheduled in four years. Positive trend in Thai property market is expected next year. Kitti Thanakitamnuay, Chairman and Chief Executive Officer, Noble Development Public Company Limited, said, “Next year, Noble Development will continue to build our business based on our expertise in developing high-quality condominiums with inspiring design in Bangkok’s CBD. Our main focuses in 2013 will be on two areas. Firstly, we will accelerate construction and sales for Noble Ploenchit luxury condominium project. Secondly, we will launch at least three new projects in the best locations in Bangkok CBD close to the BTS line. We are strongly confident that all the projects will receive warm welcome from the market.” Noble Ploenchit Progress, “Noble Ploenchit”, with its huge project value of Bt15 billion, is one of Noble Development’s pride. The project comprises several “bests” – the best location near Ploenchit BTS station, best size covering 9 rai area including 4 rai of green area in the project with the best Noble design, which is the best investment choice for customers.
“We will continue to grow our business with focus on developing high-end residential projects, both in Luxury High End and Affordable High End segments. Although it is quite difficult to find good locations in Bangkok, that’s not a problem to us. We will continue to be committed to offering only the best to our customers,” said Kitti. At least three new quality projects,Following a series of new project launches with total value of Bt2.5 billion in 2012, Noble plans to make a more aggressive move with at least three new projects in the first half of 2013. With a total investment of Bt7 billion, the new projects will represent 200 per cent growth. Located in Ratchadapisek, Thong Lor and Sukhumvit areas, the three new projects are in Bangkok’s best locations. Quality will remain at the heart of the new projects. Despite their different sizes to accommodate different financial needs of customers, all projects are guaranteed of high quality in terms of locations, design, materials, environmental friendliness and worth for investment. In the second half of the year, Noble is considering acquiring more plots for new projects to be launched before the end of 2013.
2012 strong business performance, In 2012, Noble Development has achieved Bt3 billion sales with Bt12 billion backlog which will be gradually recognized in the next 1-4 years. Thanks to the company’s strong financial outlook, Noble is confident in long-term growth.
Positive trend in property market, According to Kitti, Thai property market continues to have strong outlook, especially when considering investment potential. At present, Thai economy is in the “negative interest” stage where interest rate is relative low while inflation is on the rise. In this situation, investment in property projects, both for living and long-term investment, is considered the most efficient and secured profitable way of savings. “The AEC integration in 2015 will also encourage free flow of investment and money. That means greater opportunities for business operators to enter into high potential cities, especially those which are gateway to our neighboring countries, and in neighboring countries. Noble sees this potential and is studying possibility for this plan,” said Kitti.
Thailand. Looking two to three years ahead, there will be a further round of prime grade A projects developed. Bhiraj Tower, a grade A office development with 47,000 square metres of lettable area, located on Sukhumvit Road opposite the Emporium with direct connection to the BTS Promphong station will be completed in 2014. AIA Sathorn Tower, a grade A office building with 38,500 square metres of lettable space will be completed in 2015. AIA Capital Center, a grade A office development with 54,000 square metres of lettable area, located on Ratchadapisek Road, close to the MRT Thai Cultural Center station will be completed in 2014. G Land Tower a grade A office development with 65,000 square metres of lettable area, located at the corner of Ratchadapisek
-Rama IX Roads will be completed in 2014. However, these new projects are all just starting construction, so they will offer no immediate relief to the limited supply for at least the next 24 months. During that time, CBRE predicts that CBD rents will continue to increase and demand will increase due to companies expanding and new entrants to the market - all of which will mean that rents will only move in one direction “Therefore, tenants seeking to renew leases, expand or relocate would do well to address their needs as soon as possible. Alternatively, they need to come up with a strategy to seek early-bird deals at the new office stock that is scheduled to come on stream from late 2014 onwards,” concluded Mr. Nithipat Tongpun, Executive Director and Head of Office Services at CBRE Thailand.
With such rare qualities and features, the project has already achieved very good response from the market. The construction has already been commenced and is scheduled for completion in four years.
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Volume 10 issue 3 January 2013
Golfing for Charity
Black Mountain Again Named Best Golf Course in Thailand
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n 14th December the Banyan Golf Club Hua Hin hosted the 14th Annual Christmas Charity Golf Tournament of the Hua Hin Golf Society. All proceeds from the event will go the Bright Dawn Foundation. Bright Dawn is a registered Thai Charity Foundation established to improve the lives of poor Thai children living in rural villages surrounding Hua Hin, Thailand. The Foundation provides educational and health care support to primary schools the children attend. The Event included a Texas Scramble Team Tournament as well as putting and chipping competions. Golf was followed by a BBQ dinner, recognising the
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ith the first whiff of winter arriving, we can smell holiday exultation in the air. During this time of year, there are five things most of us associate with the season’s joyousness: partying, eating, family, vacationing and sharing. So, wouldn’t it be nice if an event could incorporate all the wintry goodness together without us having to choose between a dining table, charity and the great outdoors? Fortunately, one event does bring all this together. The Bangkok Post-Black Mountain Charity Golf and Gourmet Dinner, following the suc- cess of its inaugural event in January, is set to delight benevolent golfers and keen Golf Club in Hua Hin on Jan 12. This one-of-akind affair aims to raise funds for the 32-year-old Bangkok Post Foundation through an 18-hole charitable tournament followed by an evening of great gastronomy and auctions. The inaugural event, in which about 120 golfers participated, raised more than 3 million baht, all of which went to charitable causes without any deductions. The money was used in part to help rehabilitate seven schools devastated by last year’s flood in Ayutthaya, Pathum Thani and Nakhon Pathom provinces, while the rest was used to support the edu- cation of hundreds of underprivileged students under the Bangkok Post Foundation pro- gramme
many sponsors of the Event, prize giving and a charity auction. Over 300,000 THB was raised by this year’s Event. Everyone of the 116 golfers competing was a winner, however the main event was won by the White Sand Beach Hotel; a corporate sponsor. Team from White Sand Beach Hotel – Rob Weisbard, Huub Korver, Golf & Jorgen. Runners Up; Sam Sheriff, Karl Westerholm, Lars Uno & Vladimir Dorogoy. Consolation Prize Winners – Corporate Sponsors – Cha Am Golf Club: Paul Graff, Roger Glass, David Watson and Bent Svendsen. Words of congratulations from Stuart Daly – Director of Operations Banyan. Santa being played by Hua Hin Chairman Dicky Bird.
nationwide. ‘‘The first event was an extreme success. We had 30 teams of golfers participating and everyone really enjoyed the game, the meal and the atmosphere,’’ said Harald Elisson, the general manager of Black Mountain Golf Club Hua Hin. ‘‘They were very excited to be a part of such a good cause. When the night ended, all the guests, the chefs and the pro- fessional golfers immediately said they wanted to participate again in 2013. ‘‘Being able to raise money for schools affected by the floods was very timely and we were so pleased to be able to share the money with them. ‘‘After the event, we met with representa- tives from all the schools and were especially touched to see photos of the restoration work that was completed with the money raised at our event. ‘‘It is extremely important to put something back into local communities,’’ he added ‘‘The fact that we are doing this with the trustworthy Bangkok Post Foundation, which has done so much to help children over many years, makes it especially rewarding. I would also like to take the opportunity to thank all the golfing guests who make this event pos- sible.’’ Since its opening in 2007, Black Mountain has garnered some prestigious awards, such as the Best New Course in Asia-Pacific in its first year and the Best
hailand and Hua Hin are riding high as pre-eminent golf tourism destinations in Asia Pacific.Thailand was last week named the best golf destination in Asia Pacific at the Asia Pacific Golf Summit in Brunei. Black Mountain Golf Club in Hua Hin was awarded best course in Thailand for the second year in a row, with another Hua Hin course, Banyan Golf Club, voted second in Thailand.Last year, at the Asia Pacific Golf Summit in Pattaya, Black Mountain displaced Thai Country Club as Thailand’s best course after the Bangkok club had enjoyed seven years at the top. Black Mountain was then also named best championship course in Asia Pacific. This year, Black Mountain was named second best course in Asia Pacific behind The Club at Nine Bridges in South Korea. Black Mountain’s general manager, Harald Elisson, who attended the summit in Brunei,
Championship Golf Course in Thailand accolade from Asian Golf Monthly magazine in 2009, a title it took for the second time last year. In 2010, Asian Tour players named the club The Host Venue of the Year. Early this week, the club won the Best Course in Thailand category and Second Best Course in Asia-Pacific at the Asia-Pacific Golf Summit Awards 2012 held in Brunei. At this event, Thailand also named the Best Golf Destination in Asia. The 2013 edition of the charity event will kick off at 10.30am on Jan 12 with a golf clinic showcase by top professional golfers led by long-haired Swedish star Johan Edfors, Mikko Ilonen, Simon Yates and Rikard Karlberg. This showcase will give guests an opportunity to get up close and personal with eminent golfers and to get advice from the pros. The swing session will be followed by a luxurious Thai buffet lunch prepared by the club’s executive chef Marten Karlsson and his team. Philanthropic guests will then be treated to a fun-filled day on the award-winning 18-hole, par 72 (7,420 yard) championship course, crafted by architect Phil Ryan of Pacific Coast Design. The challenging yet playable layout, which has hosted professional tournaments including the Asian Tour Masters and the Royal Trophy, lies in a stunning setting of interconnected water- ways, undulating fairways and greens with a breathtaking natural landscape. In the evening, the beautifully landscaped club house overlooking the course’s spectacular scenery will be turned into an al fresco venue for a gourmet barbecue dinner prepared and served on site by 14 of the country’s most respected chefs from five-star Bangkok establishments. Graced by twinkling stars and touched by the congeniality of the famous chefs, the gas- tronomic affair will feature palate-teasing se- lections of international barbecue and seafood items, freshly prepared gourmet pastas, Japanese delicacies and Spanish paella as well as sump- tuous varieties of desserts, to name just a few. ‘‘We are sure the event will be bigger and better every year and become an ongoing annual festivity. We are committed to ensuring its growth. In fact, the number of top chefs joining this second episode has increased from 10 to 14 and all the chefs are now busy perfecting the menu. They told me they wanted to outdo themselves and each other this time,’’ said Elisson, with a big smile.
said he was delighted to accept the award as Thailand’s best course, as well as being pleased that two Hua Hin clubs had been recognised as Thailand’s best.“Hua Hin has made a significant mark on
golf tourism in Thailand and throughout Asia in the past five years and these latest awards reaffirm what many international and local players know – you can’t go past Hua Hin for the ultimate golf experience,” he said.Black Mountain’s top ranking in Thailand caps off a highly successful year for the club. In May, it became the first course in Thailand to be named in the US Golf Digest list of the best 100 courses outside the United States.
The golf club has recently launched two new facilities to cater to family needs. While some in the family will be out enjoying the golf, others (say, mothers and children) can have great fun at Black Mountain Water Park and Wakeboard Park, which meets the highest safety standards and features state-of-the-art technology, including a 17m tower with seven different slides, a wave pool, a lazy river and an artificial beach. THE CHARITY PROGRAMME THE 2013 Bangkok Post-Black Mountain Charity Golf & Gourmet Dinner will take place at Black Mountain Golf Club, Hua Hin on Saturday, January 12. All proceeds, without any deductions, will go to the Bangkok Post Foundation to support the education of less fortunate students. A team tournament event, the charity golf match aims to attract teams from big corporate companies and golfers from international communities in Thailand. The number of participants is set at 30 teams of four persons each. The donation for each team is 100,000 baht. The winning team will receive the 2013 Bangkok Post-Black Mountain Golf Club Trophy, and a week’s stay at Black Mountain Golf Club’s villa with a daily round of golf. WHERE Black Mountain Golf Club Hua Hin WHEN Saturday, Jan 12, 2013 COST Donation of 100,000 baht net for a team of four golfers.* Limited to 30 teams only THE PROGRAMME 10.30am Registration. Golf Clinic showcase by top players, 11.30am Thai buffet lunch, 12.30pm Shotgun start, 6.30pm Pre-dinner canapes, 7.00pm Presentation by schools renovated using funds raised last year, 7.30pm Gourmet dinner and barbecue buffet with wine and beer, Bangkok Post c/o Kusuma Minthakin Bekenn Tel: 02-240-3700 ext 1191, 1192, Black Mountain Golf Club c/o Khun May Tel: 081-378-3553
Volume 10 issue 3 January 2013
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