5 major Real Estate trends worth keeping an eye on

In Bangkok, the real estate market has known a strong growth for a few decades now and the trend should continue, particularly due to the strong interest of international investors.

To visit Bangkok is enough to realize that the real estate market is in very good health. There are every time more projects, more brand new luxury residences and new prospering districts. The Thai capital is in full transformation.

  The 5 big trends › that redefine the real estate market of Bangkok

1. Development and extension of the Subway (MRT & BTS)

The urban landscape of Bangkok has known a tremendous transformation for a few years. One of the main reasons is indubitably the extension of 2 metro lines (BTS and MRT). Bangkok has recently opened the purple line, which connects Nonthaburi to Tao poon, and has extended the green line from Samut Prakarn to Bearing.

In 10 years, Thailand’s capital will shelter 11 new subway lines, for a 3,5 billion euros total investment. This includes new lines, with for example the orange line (MRT Rama 9 – Ramkhamhaeng), the pink line (MRT fro Kae Rai to Minburi), the yellow MRT line from Lat Phrao to Hua Mak and the extensions of the blue line (Taopoon-Thapra-Hualamphong).

Those ambitious projects will shape Bangkok up, seduce new residents and investors but above all it will boost those districts’ real estate market.   

2. Central Bangkok: Soaring prices

For some years now, the price of the land in the districts located in the core of Bangkok (Sukhumvit, Silom-Sathorn and Ploenchit-Wireless) knows a steady rise. The transactions are each time more numerous.

The former embassy of Australia, on Sathorn Road, has been recently bought by Supalai Plc. The property is located on an 11,000 square meter ground. The price is said to be of 115 billion euros. It has never happened in Bangkok.

On Wireless Road, the British embassy which is 40,000 square meters, is said to have been sold for 46 billion euros to Central Groupe.

Every year the price of the land is skyrocketing in Central Bangkok. The promoters who buy those piece of land chose to develop ultra luxurious residences. They assure themselves to touch the highest return on investment possible.  

3. Mega Projects

Beyond transports’ line extensions, the steady growth of land prices and the general improvement of Bangkok residents quality of life, some known profiles have launched several big projects that will disrupt Bangkok’s landscape.

Among those megaprojects is One Bangkok. 3 billion euros have been invested in what will be a prestigious business area but also the biggest multi-functions project of Thaïland (Luxury Hotel, Office, Condos, Shops, green spaces,etc…)

Other big constructions will rise from Bangkok ground. Icon Siam will be a vast luxury shopping mall (42 billion euros of investment, should be inaugurated this year). Bang Sue is to become the biggest train station of South-East Asia (91,5 billion euros, expected for 2020).

Those mega-projects which are for the most located outside Central-Bangkok will create major opportunities for urban renovation.

4. Bangkok: Rise of new districts

We can see that a decentralization is occurring in Bangkok. It has been intensified with the development of transports and the rarity or speculation that prevail in some districts.

The Central Business District is strengthening on premium and luxury segments, with prices that can reach 400 000THB /square meter. On the contrary, numerous very promising districts emerge, seducing the Thai middle class and the investors aiming to capitalize on their investment.

Therefore, in each district now one can find all the services and the establishments he needs: Medical centers, schools, shopping mall, public transportation, parks, offices. Among the districts that flourish the most, we can name “Bang Sue”. It imposes itself as a future transport center. There is also “Rama 4”, which is on its way to became a new business area between Sathorn and Sukhumvit. Last but not least, “Thonburi Riverside”, located on the other side of Chao Phraya’s river and next to the future shopping mall “Icon Siam”, is to become a new luxury district.

5. Joint-ventures and foreign buyers

Real estate promoters focus on the local market. Yet, during the last years, foreign investors (Particularly Chinese, Hong Kongese and Singaporean buyers) have been increasingly numerous to invest in Thailand. For real estate promoters, this new target represents a huge and profitable market.

Sansiri, well-known promoter, deemed that international sales will represent more than 25 per cent of its business’s turnover in the coming years.

Sansiri, Ananda, TCC and many others developers are each time more numerous to intensify their communication and sales sectors on other markets than Thaïland.  

Several Thailandese societies go further with the creation of joint-ventures in cooperation with international societies. This strategy is a way for local firms to develop themselves in a more efficient way. As an example, the real estate promoter Sansiri is now partner with Tokyu Corp, a Japanese firm in the ambition of improving the Taka HAUS residence.

Certaines sociétés thaïlandaises vont encore plus loin avec la création de joint-ventures avec des sociétés internationales. Cette stratégie permet aux entreprises thaïlandaises de se développer de manière plus efficace sur le marché local de l’entreprise partenaire. Par exemple, le promoteur immobilier Sansiri s’est associé à la société japonaise Tokyu Corp afin de développer la résidence Taka HAUS.

Bangkok is changing so fast: Its economy is dynamic and vibrant, its streets are getting each-time more modernized and pharaonic projects are sprouting up every year. With a real estate market at full speed, Bangkok doesn’t seem ready to stop in a nearly future. It will continue to seduce local and foreign investors.