Mid to low-price Bangkok condominium developers will be under pressure this year as liquor tycoon Charoen Sirivadhanabhakdi enters this highly lucrative housing segment.
TCC Capital Land announced plans to launch its first non-luxury development, offering units from around £21,000 in Soi Sukhumvit 101/1.
TCC Capital Land is a joint venture between Singaporean-based CapitaLand and TCC Land, which is Charoen’s property development division. The middle-market condominium segment will be handled by S&S Residential.
“A large property firm is negotiating to form a joint venture or buy a major stake in a smaller company, which focuses on lower-middle-income-market condominiums,” said an un-named industry source.
“The buyer wants to strengthen its competitive edge against others, particularly TCC Land, which owns a land bank worth up to Bt100 billion nationwide.”
The source said that with increased competition, smaller property develpers would have to create new business models to survive.
TCC Capital Land’s CEO, Chen Lian Pang, who is also CEO of S&S Residential, said the company decided to launch a new brand following findings in recent surveys it conducted.
The findings showed that home-buyers today sought privacy, convenient commuting, distinctive designs and functionality in urban housing.
S&S stands for “sustainability and sufficiency”, he said.
Its surveys inspired the creation of mid-range units with more modern designs aimed at the mass market.
It’s core concept, called “Eco-Living”, is aimed at blending city living surrounded by nature, with an emphasis on green areas. Their first project, called S&S Sukhumvit, consists of two high-rise buildings on a medium sized plot. It will house 810 units ranging from 29-69 sqm.
The company launched its presale campaign on Thursday at the site, using innovative street vendors.
Senior vice president Teerachon Manomaiphibul said TCC Capital Land’s move would have a negative effect on small and medium-sized developers.
Last year in Bangkok, 66,000 residential units were launched – 30,000 of which were city condominiums priced between £20,00-40,000. Ten thousand units were city condos selling for £40,000 or more. Twenty six thousand units were small, detached houses, and the rest were townhouses, duplexes and commercial buildings.