Occupancy rates of bangkok condos increase

Occupancy rates of Thailand condos up to 75pc in the second quarter of 2012, according to CBRE.

The firm's latest market report shows that occupancy rates rose compared to the previous quarter, while prices continued to rise for a limited number of the best located, best quality completed projects. Prices for new projects are also expected to increase due to increase in land prices.

In Q2 2012, the total supply of condos in downtown Bangkok and midtown areas reached completed 328,434 units. Of this, 95,042 units or 29% are located in the downtown area, while 233,392 units or 71% are located in the midtown area.

Four projects were launched in Q2 2012 in the downtown area. The number of newly launched units decreased from 2,679 units in the previous quarter to 808 units in this quarter. Ninety-one percent of the units in newly launched projects were one-bedroom and two-bedroom units, followed by studio and three-bedroom units at 8% and 1%, respectively.

The overall occupancy rate for the downtown area increased to 75% in Q2 2012.

Apartments

In Q2 2012, there was a slight decrease in total supply. The total number of downtown apartment units decreased by 0.2% Q-o-Q and decreased 0.6% Y-o-Y, from 11,787 units in the last quarter to 11,763 units. The decrease was due to some apartment buildings being demolished or Change of use.

Occupancy in Q2 2012 was at 88.3%, up from 86.6% in Q1 2012. A total of 10,388 units were occupied in this quarter, up from 10,202 units in the last quarter. The Central Lumpini area posted the best results and the highest achieved rents with Grade A rents of THB 481/sq.m./month, up by 12.4% Y-o-Y and 3.1% Qo-Q.

As of Q2 2012, the number of expatriates holding work permits in Thailand increased from 101,385 in Q4 2011 to 103,929 in total. Japanese expatriates made up 29% of the total.

Hotels

The occupancy rate in upscale hotels in Bangkok increased to 60% in Q2 2012 from 57% in Q2 2011 as tourist arrivals rebounded strongly after the floods.

Supply grew by 1,120 keys with the completion of four new hotels this quarter.

The Average Daily Rate (ADR) of upscale hotels in Bangkok was THB 5,895, an increase of 7% Y-o-Y. Revenue per Available Room (RevPAR) was THB 3,029 in Q2 2012, a Y-o-Y increase of 15%. There are currently 33,464 hotel keys in the downtown Bangkok area. There will be an estimated 7,823 additional keys by the end of 2014, bringing the total to 41,284. This represents a 23% increase on current figures.

Housing

The number of new residential units in the Bangkok Metropolitan Region (BMR) which were completed rose in Q1 2012 (the latest figures available) to 21,941units, an increase of 52.2% Q-o-Q and 0.5% Y-o-Y. Completions of developer-built single-detached houses (SDH) in the BMR were 2,397 units, increasing by 7.2% Q-o-Q but dropping 38.1% Y-o-Y, while the completion of developer-built townhouses & shop houses (TH & SH) was 2,701 units, rising by 5.9% Q-o-Q but falling by 13.5% Y-o-Y.

28 projects single-detached houses (SDH) and townhouse projects, were launched by the nine major developers in Q2 2012 totaling 5,861 units, increasing from 4,511 units in the previous quarter (29% Q-o-Q).

More than half of these projects were located in the northern and the western part of Bangkok.

Investment

A noteworthy trend during the quarter included the continued escalation of land prices in the Bangkok CBD, particularly for sites near BTS stations.

TCC Land purchased a 14.5-rai land plot in Werng Nakhon Kasem near Chinatown (The Nation 11/07/2012, Bangkok Post 23/07/2012). L.P.N acquired three land plots during the quarter, which included a 10-rai land plot in Bangkhen, a 4-rai land plot in Bangna, and a 14.5-rai land plot in Bangsue.

There was no significant property transaction during this quarter.

In Q2 2012, two property funds were listed on the SET. Land and Houses Fund Management Co., Ltd launched the Quality Houses Hotel and Residence Freehold and Leasehold Property Fund (QHHR) and the Land and Houses Freehold and Leasehold Property Fund (LHPF).

Interest rate policy remained unchanged at 3.00% throughout this quarter.