SC to sink B1bn into US rentals

SET-listed developer SC Asset Corporation Plc plans to invest 1 billion baht in apartments for rent in the US within 2022, aiming to increase net profit from recurring income properties from 20% to one-third in seven years.

Chief executive Nuttaphong Kunakornwong said the 1 billion baht budget will be geared to two deals; a direct investment that will be finalised by the end of the year, and another one in 2022 will be invested through a joint venture with a partner.

“Despite Covid-19, the rental market in the US is very robust, particularly in Boston where we invested in two apartments,” he said.

The company’s American venture began in 2018 under a subsidiary, SC Alpha Inc, set up in the US.

SC set a total budget of 3 billion baht for the US investment. It has already spent 30% of that budget.

In Thailand, it was exploring an opportunity to acquire hotels to boost the proportion of net profit from recurring income from the current 20% to one-third over the next seven years.

At present, it has a total of 120,050 square metres of office space for rent from six towers.

It also has a new hotel in Ratchawat slated for opening early next year which was postponed from the end of this year as it will add features for workation trends.

“Since the pandemic, we could survive and now we are in a preparing phase in 2021-22 for a growth from 2023,” said Mr Nuttaphong. “We will remain aggressive in investment for a revenue target of at least 20 billion baht per year from 2023.”

In 2022, SC will spend 5-10 billion baht, of which 80% will be earmarked for acquisition in new plots of land for future residential projects, mainly in the lowrise segment.

About 2 billion baht will be reserved for investment in recurring income properties.

To capitalise on the country’s reopening next month, SC will use a network through a property brokerage firm and one of its subsidiaries, Bridge Group (Thailand), which has 300 agencies in Hong Kong, Singapore, Taiwan and China to tap foreign buyers.