Colliers Bangkok Retail Market Q2 2011

Q2 2011 (half year) | reTaIl

ThAilAnd

Bangkok RETaIL MaRkET

Bangkok Retail Market
highlighTS
occupancy showed small gains q/q with the winter shopping season helping to propel the
market.

Buongiorno Italia! Thailand’s world class retailers are looking further afield with Central
group having purchased one of Italy’s biggest retailers in Q2.

as the hypermarket sector becomes an effective duopoly some differentiation within each
mARkeT indicAToRS company’s own stores seems to be beginning with use of the word “Extra” to denote higher
Q1 2011 / Q2 2011 quality.

new Supply Community malls proliferate throughout Bangkok and are likely to overtake hypermarkets in
terms of retail space in the next few years.
RenTAlS

occupAncy

www.colliers.co.th

Bangkok reTaIl MarkeT rePorT | Q2 2011 (half year)

hiSToRicAl Supply

hiSToRicAl Supply, AS of Q2 2011

Source: Colliers International Thailand Research
Remark : E = Estimated supply

approximately 7,400 sq m was completed in Q2 2011, with nearly 6,000 More than 356,000 sq m is scheduled to be completed in the second half
sq m located in the City area and the rest in the Suburban Bangkok area. of 2011.

“The Junction” by SC asset Corporation Plc. is located in front of their City area. This project is located on narathiwas Rajanakarin road in a
own project “Bangkok Boulevard Ratchada – Ramindra” in Suburban business area including many office buildings, therefore the project aims
Bangkok – north area. This community mall not only serves their own to support those who work around the project.
residential project only but also people who live in the vicinity.

The other centre was “The City Viva” by Sun global asset Co., Ltd.
which had its official grand opening on 24 May 2011 and is located in the

COLLIERS INTERNATIONAL | P. 2


BReAkdown of ReTAil SpAce in BAngkok By cATegoRy, AS of Q2 2011


Shopping malls represent the highest share in the market with 60% or and retail developers are focusing their attention on serving the needs of
more than 3.25 million square meters and 29% of shopping mall space these residents as nearly 50% of the total residential market is located
is located in the City area. The second largest share of the market is from in the Suburban Bangkok area. Shopping venues also provide a significant
hypermarkets with 670,000 million square meters, but most of them or amount of family entertainment as they are often frequented in the
63% are located in the Suburban Bangkok area. evenings compared to their counterparts in Europe for example.

More residential projects also located in Suburban Bangkok, so retailers

The RiSe And RiSe of The communiTy mAll

Supply By locATion, AS of Q2 2011


The community mall is starting to become ubiquitous in Bangkok and it Unlike in western countries where a local supermarket would suffice; in
is forecast that by 2013 the total area will match that of hypermarkets. asia, Thailand included, the shopping experience is less functional and
The extensions of mass transit lines and the development of small community malls do not only act as a convenient shopping area but also
clustered residential areas in the suburbs necessitate the need for some as a food, beverage and entertainment location for the community. That
form of shopping complex that can serve the needs of the local community is why a considerable amount of space in community malls is dedicated
and also are an advantage for the city as a whole in that people do not to this function. also a number of themed malls are beginning to sprout
need to travel long distances to do their regular shopping. This helps to up appealing to a wider catchment area. These retail areas represent an
reduce fuel consumption and thus pollution levels. ever growing presence on the Bangkok shopping scene.



fuTuRe Supply

cumulATive fuTuRe Supply in BAngkok By yeAR And cATegoRy, AS of Q2 2011


The future supply scheduled to be completed in 2011 amounts to nearly with around 89,600 sq m of retail space. approximately 693,000 sq m
340,000 sq m, with nearly 257,000 sq m as shopping malls. The majority is expected to be completed within 2013.
will come from Central Rama 9 which is scheduled to open in Q4 2011

cumulATive fuTuRe Supply in BAngkok By yeAR And locATion, AS of Q2 2011


The majority of future supply will be in the outer City area with Embassy which is scheduled to open in 2013. Central Embassy is located
approximately 326,000 sq m or half of total future supply scheduled to along Ploenchit Road and will extend the existing main retail corridor of
be completed during the years 2011 – 2013. This is primarily from the Rama 1 further east up to the beginning of Sukhumvit road. The location
introduction of a number of large scale shopping malls including Central around Central Embassy, including the noble Ploenchit condominiums
Rama 9 and In Square. The City area will continue to be a source of new will be linked by a skybridge.
supply with the introduction of Terminal 21 within this year and Central



RenovATion

The effect of the attack in May 2010 on central world still remains a scheduled to start in 2011 including in and outside the centre and the
year on after the event. although a significant section of the mall began water park.
operations at the end of 2010, another section that was more severely
damaged and included Zen department store is slated to reopen in central Bangna set up a budget of nearly 1,000 million baht for the
november 2011, according to central group. development of a new car park building and renovation of the centre in
2011 which is scheduled to be completed in 2012.
central group also spent amount 3,600 million baht to renovate central
ladprao and it is scheduled to be completed by the end of 2011. Siam discovery center spent around 100 million baht for the renovation
of the sixth and seventh floors to create “The Sky Dining” and “Mood”
Seacon Square are spending around 150 million baht to renovate outside with a total area of approximately 1,000 square metres. The aim is to
the center including the facade, addition of more parking space and work provide a chic hangout for trendy Bangkokians.
on the area in front of the centre. They plan to complete by 2012.

The mall group plans to renovate Bang kae and Bangkapi branches with
a total budget of approximately 500 million baht. The renovation is

demAnd – TAke-up

BReAkdown of hiSToRicAl TAke-up RATe of ReTAil SpAce By locATion, Q1 2010 – Q2 2011


The take up rate in the all areas in Q2 made slight gains from Q1. The “Back to School” events and is a strong period for the retail industry
first half of the year contains many excuses for spending such as the which often reflects itself in higher take up.
January new Year holiday, Chinese new Year, Songkran festival and



TAke up RATe of cuRRenT Supply By cATegoRy, Q2 2011


Take up rate of all categories, except supporting retail, is more than 95%, they are intended to support and do not attract a significant number of
while the take up rate of Supporting retail was nearly 87%. a number of people not working in the office.
Supporting retail outlets suffer due to low office occupancy rates that

demAnd dRiveRS focuS

conSumeR confidence index (cci)

Source: Bureau of Trade and Economic Indices, Colliers International Thailand Research

The slump in consumer confidence for much of 2008 and 2009 was the 2011 this fell from Q4 by approximately 24%, due to many factors, such
result of the global Financial Crisis, which caused Thailand’s gDP to as the unrest in the Middle East and north africa, earthquakes in Japan
shrink. While confidence began to assume a sustained upward path in and Myanmar, rising oil prices and floods in southern Thailand.
the winter period of 09/10, this was severely dented following the
protests in april and May. However Q3 2010 witnessed a return to the Political uncertainties prior to the July general election may be the
rising trend and Q4 was the highest quarter in the last four years. In Q1 reason for the continued slump in Q2 2011.



ReTAil SAleS

ReTAil SAleS index By QuARTeR

Source: Bank of Thailand, Colliers International Thailand Research
Remark: Year 2002 = 100

Retail sales in Q1 2011 were similar from the previous quarter, however centres. Political disturbances only impact spending in the short term,
still higher than the past few years. Christmas, new Year and Chinese once the situation stabilizes spending returns. In many ways a vibrant
new Year as well as Valentines Day during the last quarter of last year shopping dynamic indicates on the surface that things are back to normal
and the first quarter of 2011 encourage significant spending in retail even if tensions remain.

RenTAlS

RenTAl RATe duRing The yeAR Q1 2010 – Q2 2011


The average rental rates in every area increased around the 1.4% mark which was partially the result of pre-election concerns.
q/q for Q2 2011. This was less than the rise of the previous quarter,



TRendS plans to develop new shopping malls and community malls in some
province around Thailand, especially tourist destination as Hua Hin,
expAnSion ouTSide of BAngkok
Phuket, Pattaya, Chiangmai, Hadyai and Udonthani etc.
Many retailers and retail developers not only expanded in Bangkok but
they also focused on upcountry. CPn is scheduled to be open Central foRecAST - SpReAding TheiR wingS
Plaza Phitsanulok in october 2011 with a total area of approximately
63,000 sq m. Central Plaza Suratthani is expected to be open in June Even by global standards Thailand’s retail players can stand proud. The
2012, Central Festival Chang Mai in 2013, in addition to Central Plaza country boasts some of the highest quality shopping experiences both in
Chiang Rai which opened in the first quarter of this year. CPn has set a terms of innovative ideas and strong occupancy and rental rates at its
five year plan to invest around 60 billion Baht to open 10 new malls in higher floors due to exceptional design. The retail experience is not only
Thailand within 2015 as well as abroad. In fact in May the company limited to Bangkok; Pattaya now has Central Festival which draws
bought a 100% stake in the La Rinascente, operating twelve department crowds far beyond the city, Phuket can boast Jung Ceylon, packed to the
stores throughout Italy including the flagship La Rinascente Piazza rafters on a weekend and the popularity of Palio in khao Yai has reached
Duomo in Milan. The company is also set to open stores in China, the point where an entrance fee is now charged. The main retailers are
especially in the second tier cities. now focusing on Thailand as a whole with retail malls being planned and
considered all over the country.
Robinson Department Store also has expansion plans to other provinces
in Thailand. The company plans to open in Phitsanulok this year and The retail sector now has world class players and as such they are now
Supanburi, Suratthani next year; however most of them will located in focusing their attention on the global market. Central group recently
one part of Centralplaza or Centralfestival. purchased outright one of the biggest retailers in Italy and it seems that
this pattern will continue as companies feel more confident in extending
after Big C took over all Carrefour stores last year they now have 115 their reach beyond Thailand.
stores across the country. However they are still expanding with a new
hypermarket in Tak province scheduled to open this year as well as However the market in Bangkok and its neighbouring provinces still
many smaller centres using the Mini Big C and Big C Market brands. Big remains a target for new opportunities with further large scale shopping
C changed the name of all Carrefour stores to ‘Big C Extra” on 30 June malls expected to dot the landscape of outer Bangkok for some time. at
2011.This was a requirement by Carrefour as part of the takeover. It the other extreme the popularity of community malls both in urban and
remains to be seen what Big C’ intends to do with the ex-Carrefour suburban Bangkok mean that developers will continue to find areas that
stores and the use of the word “Extra” may be a stopgap solution or part require such centres. More of these may become themed and have more
of a long term strategy. innovative designs to appeal to a wider target market than just the
immediate neighbourhood.
Tesco Lotus has plans to expand around Thailand with various models,
due to some locations not allowed to have a hypermarket. Tesco Lotus With the political scene expected to be somewhat calmer than in the past
changed the sign of the Rama 4 branch to “Tesco Lotus Extra” and this and with the economy continuing to grow, the progress of retail is set to
is the first Extra brand in Thailand and they will renovate some stores to continue. The retail experience permeates far more into the daily lives of
the Extra concept. Tesco Lotus Extra is positioned more as a premium people in Thailand than it does in Europe for instance. Retail centres are
retail center with a larger space for branded restaurants. This is probably not only places for shopping but a location where people can socialize
an effort to capture shoppers from the old Carrefour hypermarkets and and walk, away from the tropical heat. This will provide the foundations
compete with the new Big C Extra brand. Carrefour was positioned as for growth in the future along with strong and progressive local
slightly more premium than Tesco and Big C so there is now some sort players.
of brand differentiation by each of the two big hypermarket players.

not only big players in retail business made progress, but local retailers,
retail developers and residential developers also have had development



Appendix



ReTAil locATionS

ReTAil mARkeT cATegoRieS 5) Specialty Stores
6) entertainment complex (this does not include entertainment areas in
The organized retail market in Thailand can be divided into seven main
shopping malls, as these represent an intrinsic part of the shopping mall
categories, based on size, characteristics, goods sold, and pricing:
mix)
1) Shopping mall / Shopping centre
7) Supporting Retail
2) department Store (figures for this report include stand-alone stores
only; those located in shopping malls are not included) Note: For the purposes of the report, retail refers to organized retail services and
3) hypermarket excludes traditional single proprietor outlets often located in shophouses and markets
4) community mall consisting of predominantly small traders. Also, supermarkets have been excluded
from this report.



collieRS inTeRnATionAl ThAilAnd
mAnAgemenT TeAm 512 offices in 61 countries
on 6 continents
RETaIL SERVICES • a leader in real estate consultancy worldwide
asharawan Wachananont | Senior Manager
• 2nd most recognized commercial real estate brand globally
oFFICE & InDUSTRIaL SERVICES • 2nd largest property manager
narumon Rodsiravoraphat | Senior Manager • 979 million square feet under management
• over 12,500 professionals
aDVISoRY SERVICES | HoSPITaLITY
Jean Marc garret | Director

PRoJECT SaLES & MaRkETIng
Monchai orawongpaisan | Senior Manager

RESIDEnTIaL SaLES & LEaSIng
Sunate Lawskul | Senior Manager

aDVISoRY SERVICES CollIerS InTernaTIonal ThaIland:
napatr Tienchutima | associate Director
Bangkok office
17/F Ploenchit Center,
REaL ESTaTE ManagEMEnT SERVICES 2 Sukhumvit Road, klongtoey,
Bandid Chayintu | associate Director Bangkok 10110 Thailand
Tel +662 656 7000
InVESTMEnT SERVICES fAx +662 656 7111
nukarn Suwatikul | associate Director emAil info.th@colliers.com
Wasan Rattanakijjanukul | Senior Manager
Pattaya office
519/4-5, Pattaya Second Road (opposite Central Festival
RESEaRCH Pattaya Beach), nongprue, Banglamung, Chonburi 20150
antony Picon | associate Director Tel +6638 427 771
Surachet kongcheep | Senior Manager fAx +6638 427 772
emAil info.pattaya@colliers.com
VaLUaTIon & aDVISoRY SERVICES
nicholas Brown | associate Director
Phachsanun Phormthananunta | associate Director
Santipong kreemaha | Senior Manager
Wanida Suksuwan | Manager

PaTTaYa oFFICE
Mark Bowling | Senior Sales Manager
Supannee Starojitski | Senior Business Development ReSeARcheR: ReSeARcheR:
Manager / office Manager Thailand Thailand
antony Picon Surachet kongcheep
associate Director | Research Senior Manager | Research
emAil antony.picon@colliers.com 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

Colliers Bangkok Retail Market Q2 2011

Recommandé

Recommandé

Contenu connexe

Plus de Colliers International Thailand

Plus de Colliers International Thailand (20)

Dernier

Dernier (20)

Colliers Bangkok Retail Market Q2 2011