Bangkok Post

Developers eye Chinese buyers

- KANANA KATHARANGS­IPORN

Developers carrying a large number of unsold condos are tapping invest-ment-oriented overseas buyers, mainly in China.

Kitisak Jampathipp­ong, chief executive of property consultant Century 21 (Thailand) Co, said there are several developers, particular­ly listed firms, holding a large condo inventory and seeking new sales channels to drain the units.

“Condo demand in the lower to midpriced segment from Thai buyers is limited these days, as the property market slows and many buyers are rejected for mortgages,” he said.

“Some developers have shifted to overseas buyers and recorded a good sales rate.”

He said there is strong demand from investment buyers overseas, largely in China, who want to diversify in the property sector outside their homeland.

These potential buyers are wealthy middle-class investors in second-tier cities like Shenzhen or Chengdu, said Mr Kitisak. They have savings averaging 10-20 million baht, and there are some 20 million such people in China.

For Thai condos, they are looking for units priced at a maximum of 10 million baht a unit, partly because of the Chinese government issuing strict controls on overseas investment. Preferable locations include Ratchadaph­isek, Rama IX and Sukhumvit areas, with a target price per square metre of 80,000-250,000 baht.

Other investment buyers included Singaporea­ns, Hong Kongers, Malaysians and Western folks, he said.

Mr Kitisak started a matchmakin­g initiative between Thai developers and foreign buyers to capitalise on this opportunit­y.

Last year he co-invested with Singaporeb­ased property agent Angel Real Estate, creating a firm with a 60-40 equity split registered in the British Virgin Islands.

He said Angel Real Estate has a large network of property agents worldwide, totalling 700-800 firms and individual­s.

Three of its partners are Chinese investors, giving it a strong connection to local agents in China.

“Our plan is to introduce an off-plan condo project to investment buyers promoting a capital gain of at least 6% per year before project constructi­on is completed from an investment of only 25-30% of the unit price,” said Mr Kitisak.

Developers collect 25-30% of the unit price as a one-time down payment, compared with a monthly payment for 12-30 months, he said.

The joint venture started seven months ago and posted 8 billion baht in sales from 1,600 units acquired by some 1,000 buyers.

The most sales were at condos of Siamese Asset Co worth a combined 3 billion baht.

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