2018曼谷房地产市场展望（英文版）_27页-4mb

2018 Bangkok Real Estate Market Outlook Summary

Core Content

The 2018 Bangkok real estate market outlook highlights the continued growth and transformation of the property sector, driven by economic recovery, foreign investment, and changing consumer and business behaviors. The report outlines trends across residential, office, retail, and industrial & logistics sectors, along with opportunities and risks for investors and developers.

Main Views

• Economic Growth: Thailand's economy is on an upward trajectory, with strong growth in exports and tourism. The GDP growth is forecasted to reach near 4% in 2018, supported by 35.3 million tourist arrivals in 2017 and a 9.9% increase in exports.
• Residential Sector:
  • Foreign capital influx is increasing, with developers forming joint ventures with international partners, especially from Japan, Hong Kong, Singapore, and China.
  • The luxury condominium market is still dominated by Thai buyers, but midtown and suburban markets are showing signs of recovery.
  • Developers are diversifying into income-producing properties such as offices, hotels, and retail to spread risk.
  • Land prices in prime CBD locations are rising sharply, pushing developers to explore new areas.
• Office Sector:
  • Office demand remains steady, with an expected annual take-up of 200,000 sq.m. over the next few years.
  • Vacancy rates are expected to fall, but rent growth will slow.
  • The 360 workplace strategy is gaining traction, with tenants seeking more flexible and cost-effective solutions like co-working spaces.
  • Major office developments such as Gaysorn Tower and Bhiraj Tower at BITEC are achieving record rental rates.
• Retail Sector:
  • The retail market faces challenges from e-commerce growth, which is expected to reach THB 2.8 trillion in 2017, or 9.86% Y-o-Y.
  • Retail landlords are focusing on renovations and expansions to create unique experiences.
  • New supply is expected to increase in 2018, with projects like ICONSIAM and the second IKEA at CentralPlaza WestGate set to open.
• Industrial & Logistics Sector:
  • E-commerce growth is driving demand for modern logistics properties.
  • Serviced industrial land plot sales increased by 35.2% in 2017, but ready-built factory vacancies remain high.
  • The government's Thailand 4.0 and Eastern Economic Corridor (EEC) policies are expected to boost manufacturing and logistics investment.
• Capital Markets:
  • Prime land prices have surged, with notable land sales such as the British Embassy site and Soi Langsuan development site.
  • Developers are diversifying their investment portfolios to include non-residential properties.
  • The proposed land tax on unutilized land has been postponed, creating uncertainty for investors.

Key Information

• Economic Outlook: Strong GDP growth from exports and tourism, with consumer confidence improving.
• Foreign Investment: Joint ventures with foreign partners are becoming more common, especially in the residential and office sectors.
• Land Prices: Prime CBD land prices continue to rise, with record sales and limited availability of freehold land.
• Office Trends: Co-working spaces are emerging as a viable alternative to traditional office leasing, with major players expanding in Bangkok.
• Retail Challenges: E-commerce is reshaping retail, pushing landlords to innovate and create experiential spaces.
• Industrial Growth: E-commerce and improved logistics infrastructure are increasing demand for industrial and logistics properties.
• Market Risks:
  • Overpriced land may make developments unfeasible.
  • Affordability in the mass residential market remains a concern.
  • Potential oversupply in various sectors if all planned developments proceed simultaneously.
  • Political uncertainty and possible interest rate hikes pose risks to the market.
• Market Opportunities:
  • Continued economic growth and consumer confidence.
  • Expansion of infrastructure and EEC projects.
  • Diversification of property investments by developers.
  • Increased demand for co-working and flexible office spaces.

Investment Diversification

Developers are increasingly diversifying their portfolios into different property classes and customer segments to mitigate risks and capitalize on new opportunities. This includes moving into office, hotel, and retail developments, as well as leveraging technology and new market trends.

Conclusion

Bangkok's real estate market in 2018 is poised for growth and transformation, driven by economic recovery, foreign investment, and evolving business and consumer preferences. However, challenges such as overpriced land, affordability issues, and potential oversupply must be managed carefully to ensure sustainable development and investment returns.