Treasury eyes accelerated construction
The Treasury Department looks set to amend a condition in its lease concession contracts to start charging rent from the date a contract is signed, aiming to compel concessionaires to speed up investment.
The change is meant to address concessionaires’ delays in construction, said Patchara Anuntasilpa, director-general of the department.
In the new contract language, delays in construction will add more costs to concessionaires, making it more likely that they will complete projects on time, Mr Patchara said.
The current contracts allow the Treasury Department to start collecting rent from concessionaires when construction is complete and the project is delivered, while the department can charge fees for land usage during the construction period.
The department is the country’s largest landlord, with 12.5 million rai across the country under management.
The department said earlier that it had put three long-delayed development projects — the Mor Chit area, the construction of a boutique hotel on a prime plot on the east bank of the Chao Phraya River, and the expansion of Queen Sirikit National Convention Center — on the front burner.
The concession to develop the 63-rai Mor Chit project was won by Bangkok Terminal, but the company failed to initiate development because of legal obstacles.
The Mor Chit project is envisioned to include a department store, office buildings, apartments and a hotel.
The Treasury Department granted N.C.C., which is owned by liquor tycoon Charoen Sirivadhanabhakdi, the contract to enlarge the convention centre, parking lot and commercial areas to at least 180,000 square metres. The concession contract will last for 50 years, including three years for construction.
SET-listed U City is the concessionaire of the prime plot on the east bank of the Chao Phraya River.
Natural Park was renamed U City after BTS Assets Co and Kamkung Properties Co from BTS Group Holdings were amalgamated, and the consortium won a 30-year concession from the Treasury Department in 2005 to develop and manage the boutique hotel on a five-rai plot on Charoen Krung Road, despite doubts over its financial status.