Developers across Thailand have remained calm and confident in the country’s real estate market general, but with prolonged political activity in Bangkok some are starting to become more cautious. Developers Ananda Development Plc (ANAN) is planning on launching fewer properties than last year, focusing more on cost control and sales for projects that are currently ready to generate revenue. The company plans on launching only four new condo projects this year; a steep decline from the 18 it launched last year.
The decline in new developments this year is hurting construction real estate companies, many of which have had to adjust their business strategies for 2014. One such example is DCON, which is focusing its strategy on the distributions of its products in areas away from Bangkok and has stated that the revenue it expects from construction will be down from 95 per cent to 65 per cent this year. Another example is steel manufacturer, Millcon Steel Industries, which has stated that their revenue is down by 10% since last quarter. Similar to DCON, Millcon has adjusted their current business to focus on seeking new markets and potential business outside of Thailand in nearby countries.
Thailand’s major gulf coast city of Pattaya completed and transferred just 800 units in H1 2013, but nearly 7,100 units were completed in the second half, making 54,650 the total number of units completed in 2013. This is the highest on record, reports Colliers International. While the take up rate and average price for the second half of the year was lower than the first half, developers still are expressing confidence in the market. The slower take up rate can be justified by the large number of Pattaya condominium projects that were only recently completed, as well as new possible hesitation by investors due to the protests.
