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Bangkok real estate market shows resilience

Friday, 03 October 2008

The Nation October 2, 2008 Bangkok's real estate sector has proved to be resilient over the past nine months despite political turmoil and slower economic growth, Jones Lang LaSalle, a professional services company specialising in real estate, said. Managing director Suphin Mechuchep said that despite the political unrest and global economic slowdown, Bangkok's property market had fared better than expected over the past nine months. In the market for office space, there have been signs of recovery in demand with leasing activities growing as compared to last year. This is partly because companies that had delayed expansion plans last year decided to proceed with them to ensure their ability to continually capture business opportunities. Another reason has been that companies are now taking advantage of depressed market conditions and seeking more favourable lease terms. In the Bangkok retail market, uncertainty in the Thai and global economies continued to hinder the market while the consumer confidence index continued its downward trend. Prospects in the retail market were dampened further with the state of emergency being imposed in Bangkok, leading to cancellation of travel plans by tourists. In the short term, this adversely affected not only the hotel industry but also the retail sector. However, the market is generally undersupplied with average vacancy in prime retail centres growing at a single digit rate. The emerging concept of community malls continued to perform well. "Demand in the property markets relies on the country's economic conditions. To date, Thailand's economic outlook has remained uncertain. Externally, deteriorating prospects in the world econoฌmy following turbulence in the financial markets in the United States and Europe will inevitably affect investment globally. Internally, though the country has recently got a new government, stability has not been attained," she said.

 

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