Real estate hits B100bn boon
Russian nationals led the way as over B100 billion was invested in Phuket real estate development last year, according to a study by a leading international investment management company.
Extensive project development and investment island-wide has resulted in the province being declared as the country’s leader in regards to luxury property development and investment in 2023, the Colliers International report revealed.
Phattharachai Thaweewong, Director of Research and Communications at Colliers International Thailand stated last Friday (Jan 26) that the emergence of luxury condominiums and villas in Bang Tao on the Island’s west coast in particular have seen prices sky rocket to B100 million per rai in the area.
It has resulted in Bang Tao being unofficially referred to as ‘Thong Lor’, literally translating as ‘liquid gold’.
Mr Phattharachai was referencing a report conducted by his firm on the overview of land transactions in 2023 in Thailand, with the majority taking place in tourist specific provinces such as Chonburi, Rayong, Hua Hin and Phuket.
“Following the reopening of the country after the COVID-19 pandemic, the most bustling tourism city in Thailand is Phuket,” Mr Phattharachai said. “The recovering tourism sector has seen foreigners buying condominiums and pool villas at a phenomenal rate, either as a second home or to invest and rent out to people of the same nationality.”
The latter practice is something especially prevalent amongst Russian nationals, according to Mr Phattharachai. “Russian nationals are the main group involved in this,” he said. “We have witnessed many times the phenomenon of Russians buying multiple units, buying the whole floor in a complex or even the whole building. It resulted in the real estate market in Phuket truly exploding in 2023.”
Mr Phattharachai further explained that it has been the opposite in Bangkok with high prices in the capital resulting in a somewhat stagnant market there during the past 12 months.
As a result many real estate developers from the capital joined overseas investors to focus on development opportunities in Phuket last year, with over B100bn pouring into the province, the highest figure in a 12-month period in many years.
“Extensive condominium development has seen more than 8,600 new units launched, far higher than the usual 3,000 units launched on a yearly basis, while over 1,000 units have been launched through pool villa projects, with prices ranging between B40 million to B100mn,” commented Mr Phattharachai.
Bang Tao has seen massive development with entrepreneurs investing in projects including a joint venture between Assetwise Public Company Limited (ASW) and Botanica Luxury Phuket Co Ltd. Others include Origin Company Property Ltd, Central Group, Siamese Asset Public Co Ltd and Habitat Group Co Ltd.
“There has been a massive influx of new developments in Bang Tao,” Mr Phattharachai said. “As a result, the current price of land adjacent to the beach or near the beach has increased to more than B100mn per rai. Meanwhile, the rental price for condominiums is B1,000 per square metre resulting in typical rentals ranging between B40,000 to B70,000 per month.”
Krit Techasamma, Managing Director of Origin Nationwide Company Limited, a subsidiary of Origin Property Public Company, or ORI, said that the company has invested in developing the Jin Resort World Phuket Bangtao Beach project, valued at B8bn on an area of 25 rai next to Bang Tao Beach. It is a beach known for beautiful sunsets and is considered a central location for visitors to travel elsewhere while in Phuket, Mr Krit said.
Other prominent developments include the So Origin Bangtao Beach five pronged project, consisting of an eightfloor high luxury condominium, 35 luxury pool villas, a 5-star hotel, luxury branded residences and a beach club known as Tichuka Phuket. Construction is scheduled to start in the third quarter of this year and will conclude in the first quarter of 2026.
Moving away from the Bang Tao area, Korn Narongdej, Chief Executive Officer of Raimon Land, said that his company plans to build a range of exclusive low-rise ultra-luxury villas on Kamala Beach in the fourth quarter of 2024 in a development project worth approximately B7bn.
While last year was a record, Colliers’ Phattharachai predicts no repeat in 2024 as the emphasis will be on selling old projects that have been developed recently but have yet to be sold.