1. Q3 2010 | CONDOMINIUM
THAILAND
BANGKOK CONDOMINIUM MARKET
REPORT
Bangkok Condominium Market
EXECUTIVE SUMMARY
New launches in Q3 2010 increased dramatically compared to the previous quarter as delayed
launches were resumed after the unfavourable conditions for most of Q2 2010.
Only 1,900 units were supplied in Q3 2010 after the ending of the tax incentives, however it is
forecast that up to 23,000 could be supplied in Q4 2010.
Developers are shifting focus towards urban Bangkok as more units will be supplied in the urban
MARKET INDICATORS area. Suburban Bangkok still remains rmly on the radar with listed developers targeting the low
to mid end segment of the market. For the whole of Bangkok 75% of units were launched by listed
Q2-Q3 2010
developers in Q3.
SUPPLY
The luxury market has remained resilient throughout the year and launches in Q3 2010 were
LAUNCHES particularly strong.
PRICES
TAKE-UP
OCCUPANCY
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2. BANGKOK CONDOMINIUM MARKET REPORT | Q3 2010
NEW CONDOMINIUM LAUNCHES REACH RECORD HIGHS
NEWLY LAUNCHED CONDOMINIUM UNITS DURING THE YEAR 2009 – Q3 2010 BY QUARTER
Source: Colliers International Thailand Research
Newly launched units in the third quarter of 2010 increased over ve fold in Q3 which partially accounts for the surge. However the overall outlook
from Q2 2010 and represented a 63% increase on the robust Q1 2010 of developers remains bullish in tapping into latent demand despite the
gure. Nearly 23,600 units were launched in Q3 2010. Many launches sporadic travails a icting the country.
were put on hold due to the events of April/May and these recommenced
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4. BANGKOK CONDOMINIUM MARKET REPORT | Q3 2010
CITY AREA
The area covers four adjacent but competing sub-markets: the Sukhumvit Road; the Silom / Sathorn section; and the Riverside section fronting the
section comprising Sukhumvit Road between Soi 1 and Soi 55 to the Chaophraya River along Charoenkrung Road and Charoennakorn Road,
north and Soi 2 and Soi 38 to the south; the Central Lumpini section where several ve-star hotels are located. The City Area is convenient
including Phloen Chit Road, Rama I Road, Soi Langsuan, Soi Sarasin, for businessmen, expatriates and tourists, because of its proximity to
Chitlom Road Ratchadamri Road, Witthayu Road and Rachaprasong many o ce buildings, retailing and local attractions.
CITY FRINGE AREA
This area covers three parts of Bangkok:
o Northern Fringe: This section covers the BTS route starting from o Eastern Fringe: This section covers the BTS route starting from Thong
Ratchathewi Station to Mo Chit Station to the north and the MRT route Lor Station to On Nut Station to the east, Rama IV Road and Petchaburi
starting from Petchaburi station to Bangsue station to the north. Road,
o Southern Fringe: This section covers Narathiwad Ratchanakarin Road, This area covers locations with their own local infrastructure and
Chan Road, Sathupradit Road, Charoenkrung Road and Rama III Road convenient transportation but require commuting to have access to the
along the Chaophraya River. central business and entertainment areas.
OUTER CITY AREA
The area covers two parts of Bangkok:
o Outer City (East): This section starts from the extension of the BTS Krung Thonburi Road to Ratchaphruek Road near Petchakasem
route at On Nut Station to the Bangkok boundary to the east. intersection.
o 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
SUBURBAN BANGKOK
These are the environs outside the areas already mentioned. Expansion of new condominiums in this area. Suburban Bangkok represents the
of the mass transit system is the main determinant for increasing future biggest area and for the purposes of this report includes Bangkok city old
supply in a particular area. The expansion from On - Nut to Samut town (Koh Rattanakosin area and boundary area). This location has
Prakarn is scheduled to be completed in 2011. The expansion of the BTS comprehensive town planning controls restricting building height, so
will bene t directly the surrounding condominiums, as it will considerably there are no condominium projects in the area.
reduce transportation costs and time. This will encourage the development
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5. BANGKOK CONDOMINIUM MARKET REPORT | Q3 2010
NEWLY LAUNCHED CONDOMINIUM UNITS IN Q3 2010 BY LOCATION
Source: Colliers International Thailand Research
The majority of launches in Q3 2010 occurred in the urban area compared The largest project in this quarter, The Trust Residence Pinklao by The
to suburban Bangkok. The suburbs have dominated supply but now the Con dence Co., Ltd., was launched in the suburban Bangkok area with a
urban areas are proving more popular. total of 1,399 units. However, the listed companies (including their
subsidiary companies) continued to lead the market with approximately
Within urban Bangkok, the Northern Fringe area has shown the highest 17,000 units or 75% of the total in Bangkok.
numbers with approximately 4,300 units. Nearly 52% of the total units
were launched in September.
A COMPARISON OF NEWLY LAUNCHED UNIT BY LISTED COMPANY AND NON LISTED COMPANY DURING Q1 2009 - Q3 2010
Source: Colliers International Thailand Research
Listed developers continue to take up the lion’s share of newly launched such as Sansiri and Quality Houses, have now entered the market for
units and for Q3 2010 this has become more pronounced. Larger units below two million baht that have become all the rage.
developers who previously focused on more mid to higher end projects
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6. BANGKOK CONDOMINIUM MARKET REPORT | Q3 2010
NEWLY LAUNCHED CONDOMINIUM UNITS IN CITY AREA, Q1 2009 – Q3 2010
Source: Colliers International Thailand Research
More than 2,500 units were launched in the City Area for Q3 which consequence of the protests which began in February 2010 but was
shows that the surge has also taken place in prime areas where land is ratcheted up in April.
more expensive. The limited number of launches prior that was a direct
NEWLY LAUNCHED CONDOMINIUM UNITS IN NORTHERN FRINGE AREA, Q1 2009 – Q3 2010
Source: Colliers International Thailand Research
Although the political protest was in the City area, it impacted other during the protests. Newly launched condominium units in the Northern
areas too in Q2 due to buyer sentiment and transportation problems Fringe area dramatically increased to more than 4,300 units.
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7. BANGKOK CONDOMINIUM MARKET REPORT | Q3 2010
HISTORICAL SUPPLY
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
Only approximately 1,900 new condominium units were completed and condominium units scheduled to be completed in Q4 2010 could be
registered at the Department of Land in Q3 2010 despite the continuation nearly 25,000 units. Whether a signi cant proportion reaches the
of some of the incentives. However the rush to beat the previous deadline scheduled completion deadline of 2010 remains to be seen.
in Q2 for incentives was largely the cause for this fall. Overall there was
a drop of about 44% from the previous quarter. However total
TOTAL HISTORICAL SUPPLY BY LOCATION TO Q3 2010
Source : Department of Land, Colliers International Thailand Research
Around 67% of total condominium units are located in the suburban the centre, mass transit connections and relatively lower land prices
Bangkok area with a total of more than 186,000 units. Within the urban compared to the City area.
area, the Northern Fringe contains the most units due to its proximity to
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8. BANGKOK CONDOMINIUM MARKET REPORT | Q3 2010
ADDITIONAL SUPPLY PER QUARTER | CITY AREA, Q1 2009 – Q3 2010
Source: Colliers International Thailand Research
Only 65 units was added in Q3 2010, so total supply in this area was completed in the last quarter of this year.
approximately 21,700 units. Roughly 3,600 units are scheduled to be
ADDITIONAL SUPPLY PER QUARTER | NORTHERN FRINGE AREA, Q1 2009 – Q3 2010
Source: Colliers International Thailand Research
Approximately 250 units were added in Q3 2010, although almost 8,500 near future, especially Phahonyothin, Ratchadapisek, Ari and Sutthisan
units are under construction and scheduled to be completed in this year. Road. The Northern Fringe contains a signi cant number of BTS and
This area still remains the main target for condominium projects in the MRT stations, the key public transportation arteries in Bangkok.
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9. BANGKOK CONDOMINIUM MARKET REPORT | Q3 2010
FUTURE SUPPLY
CUMULATIVE FUTURE SUPPLY SCHEDULED TO BE COMPLETED DURING THE YEAR 2010 – 2013
BY LOCATION IN URBAN BANGKOK. (AS OF Q3 2010)
Source : Colliers International Thailand Research
Remark : Supply does not included unit in Suburban Bangkok
The Northern Fringe area continues to be the main player in urban is expected that the Northern Fringe will continue to dominate supply for
Bangkok with approximately 8,450 scheduled to be completed in the last the early part of the decade.
quarter of 2010 and some projects delayed from the second quarter. It
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10. BANGKOK CONDOMINIUM MARKET REPORT | Q3 2010
TAKE UP
SALES PROPORTION OF NEWLY LAUNCHED UNITS IN Q3 2010 BY LOCATION
Source: Colliers International Thailand Research
The take up rate for condominium projects in Bangkok for Q3 was popular with buyers. The prime location of the City area accounts for the
approximately 51 %. The occupancy rate in the Northern Fringe area high take up there and the a ordability of suburban Bangkok to mostly
was the highest followed by the City area and suburban Bangkok area. rst time buyers is the main reason behind its popularity. It must be
Various factors account for this; the fact that many of the Northern pointed out that over half of the units were launched in September, and
Fringe launches are close to mass transit lines means that they are very as the last month in the quarter this would generate a lower gure.
SALES PROPORTION OF NEWLY LAUNCHED UNITS IN BANGKOK BY QUARTER
Source: Colliers International Thailand Research
The lesser gure for Q3 2010 indicates how buying patterns of rates. While there have been murmurs that the market is beginning to
condominiums are changing. In the past with the advent of small size seize up, the more realistic answer is that buyers are taking their time
unit developments, buyers would snap them up within hours of the and shopping around before making a purchase. The euphoria of the
o cial launch in an ‘until stocks last’ frenzied atmosphere. Nowadays as surge in buying activity in Q4 2009 to Q2 2010 is starting to become a
more and more of these types of products are being launched, take up thing of the past but not the demand for a ordable units. Developers will
has been slower with similar projects now recording lower initial take up need to work that bit harder but the rewards are still there.
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11. BANGKOK CONDOMINIUM MARKET REPORT | Q3 2010
LAUNCHES WITH HIGH TAKE UP RATES IN Q3 2010
D Condo by Sansiri Plc. has shown the highest take up rate of almost
100% of its 916 units with a selling price of approximately 1 million
baht. Only 29 sq m studio units were available and the project is
located on On Nut – Latkrabang Road.
Noble Revent by Noble Development Plc. had its 261 units sold out in
one day. Noble Revent is located in a prime area, close to BTS
Phayathai Station and Airport link. Most units are one bedroom with
the smallest being about 33 sq m.
LPN Development Plc. still continues to be the main player in the
market, Lumpini Place Rama 9 – Ratchada phase 2 sold out its units
within a few hours. Unit sizes start from 33.5 sq m for one bedroom
and 70 sq m for two bedroom units. The project is located on Rama 9
Road.
In the City area VIA 49 by Sansiri has shown the highest take up rate
with only 85 units with a selling price of more than 140,000 baht per
sq m. Unit sizes start from 35 sq m for one bedroom units and the
project is located between Thong Lor and Phrom Phong.
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12. BANGKOK CONDOMINIUM MARKET REPORT | Q3 2010
TAKE UP IN PROXIMITY TO EXISTING MASS TRANSIT LINES Q3 2010
Source: Colliers International Thailand Research
The take up rate of condominium projects less than 200 meters from located more than 1,000 meters from mass transit lines showed the
BTS / MRT lines was still the highest at nearly 70%, followed by the lowest rate of around 43%.
projects 501 – 1,000 meters from the BTS / MRT at 59%. The projects
THE AVERAGE TAKE UP RATE OF NEWLY LAUNCHED UNITS DURING Q1 - Q3 2010 BY DISTANCE FROM BTS / MRT
Source : Colliers International Thailand Research
The average take up rate of condominium units in the rst three quarters prices being similar or a little lower than the those of projects less than
of 2010 shows that those developments located within 200 metres of a 200 meters from the BTS / MRT but the additional distance means more
mass transit station remain popular with buyers. The take up rate in the likelihood of requiring a motorbike or taxi to a station, thus reducing their
area 201 – 500 meters from mass transit is lowest, due to the selling appeal to buyers.
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13. BANGKOK CONDOMINIUM MARKET REPORT | Q3 2010
INITIAL LAUNCH PRICES
AVERAGE SELLING PRICES OF NEWLY LAUNCHED PROJECTS IN CITY AND CITY FRINGE AREA H12010 – Q3 2010
Source: Colliers International Thailand Research
Note: Q2 2010 only 1 – 2 projects were launched in each location, the Eastern Fringe area jumped by around 43% although this was primarily
selling prices may not be realistic, so the rst and second quarters of due to many projects being launched by listed developers who can
2010 have been included together for a more reliable assessment. command a premium due to their reputation and generally better
nancing options. City area prices have fallen due to the less desirable
Selling prices remain robust during the third quarter as developers locations of projects away from the main roads.
squeeze prices by reducing unit sizes to tap into demand. Prices in the
AVERAGE SELLING PRICES OF NEWLY LAUNCHED PROJECTS IN OUTER CITY AND SUBURBAN BANGKOK AREA H1 2001 – Q3 2010
Source: Colliers International Thailand Research
Note: Q2 2010 only 1 – 2 projects were launched in each location, the area due to the extension of the BTS Silom line into Thonburi. Prices
selling prices may not be realistic, so the rst and second quarters of over this time have re ected this fact. However the area is limited in size
2010 have been included together for a more reliable assessment. and prime land plots are now in short supply, recent launches include
locations further from the BTS stations thus accounting for the lower
Since 2006 big name developers, such as Sansiri, Quality Houses, TCC selling price in Q3. The increase in Suburban Bangkok was due to the
Capital Land, Ananda Development, Narai Property and Land & Houses increased involvement of listed developers.
have started to develop condominium projects in the Outer City – West
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14. BANGKOK CONDOMINIUM MARKET REPORT | Q3 2010
AVERAGE SELLING PRICE OF NEWLY LAUNCHED PROJECTS IN Q3 2010
Source: Colliers International Thailand Research
The City area remains the prime location and can command higher Fringe prices. The perception of the Southern Fringe area as an upmarket
prices. The lure of Sukhumvit road, with its own self contained location still prevails with some developers despite the lack of mass
environment and mass transit connections continues to propel Eastern transit lines, except the recent Bus Rapid Transit.
LAUNCH PRICES: MASS TRANSIT EFFECT
SELLING PRICES OF NEWLY LAUNCHED PROJECTS BY PROXIMITY TO MASS TRANSIT LINES (BTS AND MRT), Q3 2010
Source : Colliers International Thailand Research
Projects located within a couple of hundred metres from a mass transit from mass transit. The area is arguably the only fashionable, up market
station still command a premium. The location of Thong Lor goes some location that is for the most part some distance from the BTS or MRT
way to explain the high prices of developments further than 500 meters although some are now located closer to the new Airport Link.
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15. BANGKOK CONDOMINIUM MARKET REPORT | Q3 2010
TRENDS – LISTED DEVELOPERS ARE FOCUSING MORE IN THE SUBURBAN BANGKOK AREA
In 2009 listed developers accounted for 12,000 condominium units focus on the growth in the lower – mid range market and most of these
launched in suburban Bangkok area but in the rst three quarters of are located in the suburban Bangkok area due to lower land prices. For
2010 more than 15,500 units were launched representing an increase of Q4 2010 Sansiri Plc, Land & Houses Plc and Quality Houses Plc plan to
29%. This was the result of listed companies setting up new brands to launch more condominium projects in the suburban Bangkok area.
DEMAND DRIVER – FUTURE GROWTH OF BANGKOK
ACTUAL AND ESTIMATED ADDITION OF POPULATION IN BANGKOK FOR EACH 5 YEAR PERIOD
Source: Colliers International Thailand Research
Source: Population Division of the Department of Economic and Social A airs of the United Nations
Urbanisation is a key trend in industrializing countries around the world and Laos also have an e ect. In the next ve years the population is
and Thailand is no exception. The lure of better economic prospects estimated to grow by 423,000 and obviously these people must live
leads thousands to leave the provinces in search of a better life and the somewhere. While this is likely to require low end housing this will have
commercial centre attracts the lion share of this internal migration. Also a spill over e ect on mid to high end housing as the population bene ts
movements of migrants from the neighbouring countries of Myanmar from economic growth created by the increase in population.
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16. BANGKOK CONDOMINIUM MARKET REPORT | Q3 2010
FINANCING
HOUSING LOANS FOR PERSONAL CONSUMPTION EXTENDED BY FINANCIAL INSTITUTIONS
Colliers International Thailand Research Source : Bank of Thailand
Note: Excludes negligible amounts of nancing from other sources
Financing of residential real estate is both a source of growth and a compared to specialized nance institutions such as the Government
product of it but the availability of nance is vital to supporting the sector. Housing Bank which continues to provide the foundation. It would appear
For every quarter from 2008 nancing has been on the rise and that even for lower end products commercial banks are willing to provide
commercial banks have increasingly become the more dominant players nance.
THE LUXURY CONDOMINIUM MARKET
LUXURY CONDOMINIUM UNITS LAUNCHED DURING Q1 2009 – Q3 2010
Source : Colliers International Thailand Research
Despite the interest generated by the launches of a ordable condominiums 215 units on Phayathai road, close to the Airport link Phayathai station
the luxury segment is also experiencing healthy growth. In fact, and 161 units of M Silom on Narathiwas Rajanakarin. Sansiri launched
approximately 670 units were launched in Q3 2010. From Q1 2009 – Q2 VIA 49 on Sukhumvit road with only 85 units. Most buyers are Thai and
2010 most of the launches sold out within few weeks due to limited even in this market segment foreign demand is not the most critical
choices but the same has not been the case for Q3 2010 due to the factor in the success in a development.
amount of units. Major Development Plc introduced M Phayathai with
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17. BANGKOK CONDOMINIUM MARKET REPORT | Q3 2010
FORECAST
The breakneck number of launches is set to slow over the next few
quarters but still remain robust as developers need to consolidate and
focus on construction and marketing of their existing projects.
Although take up has slowed the demand for low end, smaller unit size
condominiums below two million baht looks set to continue as these
appeal to lower income earners who constitute the vast majority of the
workforce in Bangkok. The danger is that the high level of launches
continues unabated thus swamping the market too quickly. However the
lower take up rates will have a sobering a ect on sentiment. In all
likelihood launches look set to moderate to sustainable levels and allow
the residential market to consolidate.
Changes in planning regulations in 2011 following the national census
could lead to more relaxed restrictions on the minimum number of car
parking spaces that must be included in a new development. As many
projects are located close to new mass transit lines, car ownership for
these buyers may be lower and developers can t in more residential
units at the expense of parking spaces.
In the long term the growth patterns of Bangkok’s residential market will
be shaped by the development of new mass transit lines. A ordability
will continue to drive the market although it is di cult to envision unit
sizes being reduced much further. Only when the high density
developments are completed can the standard of living for the occupiers
be assessed. Developers will be taking a keen interest when these recent
launches are nally supplied in order to make adjustments to future
projects.
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18. BANGKOK OFFICE MARKET REPORT | Q3 2010
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