End users will continue to dominate the Thailand property market in 2022 with sophisticated buyers requiring developers to adapt their projects. According to CBRE Thailand, changing tastes and requirements forced many homebuilders to rethink the residential experience they provide in order to compete.
“This year, the end-users will be much more sophisticated with new demands. Developers will need to take a more proactive approach to clear unsold inventories while differentiating the projects, taking into account the change in requirements from end-user buyers,” Khun Artitaya Kasemlawan, Head of Residential Sales – Project at CBRE Thailand, commented. “Product trends will focus on larger space and functions related to post pandemic requirement including multi-purpose family room, open green space, wellness and technology.”
Several leading developers have been proactive in this regard. SC Asset and Pieamsuk Property Development are among the firms to have incorporated more spaces and special features designed to handle increased home usage by residents. Meanwhile, The Forestias from MQDC has launched a number unique developments within the mixed-use complex in an attempt to meet the needs of sophisticated buyers.
Bangkok condominiums account for the largest percentage of the Thailand residential property market and it has been hit the hardest by the COVID-19 pandemic. New condo launches in the Thai capital plummeted to a 15-year low in 2021 and CBRE predicts sales in this segment will continue to be slow.
However, there are a few areas of the Bangkok condo market that are performing solidly. According to the consultancy, projects near universities or branded residences remain popular. Additionally, condos in Thailand’s resort destinations have stayed in demand as well.
The effects of the COVID-19 pandemic have also impacted other residential real estate segments. The resale market has opened up in recent years with several coveted units going up for sale. Meanwhile, family and lifestyle considerations are seeing many Thai buyers consider overseas property with the UK and Portugal among favored options.
“For the resale market, the COVID-19 situation has had some positive effects in terms of allowing rare units that weren’t typically found in a normal market to become available for sale again. Demand for overseas properties also continue to rise as factors such as family-wellbeing and lifestyle fulfillment urged unburden Thai buyers to broaden their property investment decisions,” Khun Praphinleeya Phuengkhuankhan, CBRE Head of Residential Sales Ad Hoc, stated.
Related: 4 Things to Know About Thailand Property Investment in 2022
Office and retail landlords in Thailand face challenges in 2022
Even with a return a work happening across Thailand, office and retail landlords in the Kingdom need to brace themselves for potential challenges. As companies rethink their approach to workspaces, CBRE warns old office buildings in Bangkok that have not been renovated or refurbished could become obsolete.
“Tenants will need to explore the options for relocation or expansion in high quality buildings that will be completed in the near future as flight for quality continues. Workplace strategy will also be key for occupiers to match with the future of work,” Khun Roongrat Veeraparkkaroon, Managing Director of CBRE Thailand, said. “Landlords, entering to the highly competitive market, need to proactively upgraded and incorporate new elements into their projects to meet the ESG requirements. Priority need to be on maintaining the occupancy rate rather than focusing on the achievable price per square meter.”
On the retail side, the Thai public’s rapid embrace of e-commerce has forced many brands to assess their brick-and-mortar strategy. Landlords in this segment must be flexible and supportive as firms rethink their approach in a “New Normal” world.
“Retailers will also look for collaboration with third-parties to bring in new experience to their brands,” Khun Jariya Thumtrongkitkul, Head of Retail at CBRE Thailand, explained. “The retail landlords will need to work hand-in-hand with the tenants to provide more flexibility in the lease terms while adopting new approaches to bring back footfall into the project.”