Status of a company set up by a property developer

[Delight]

The first stage ,it seems to me-is when a developer decides to develop i.e. a condo building -is to open a Thai company.

At some point every apartment will be in the name of that company.

Then ,one by one, the apartments are transferred to those who have bought the apartments.

Simple enough.

My Q -What happens to the original company.

It has no further role. It is closed down or kept alive ?

[FritsSikkink]

You develop more property.

[Delight]

8 minutes ago, FritsSikkink said:

You develop more property.

 Perhaps I did not explain correctly

The name of the company will be typically

 

'Name of Condo'   co., ltd

 

The company is set up to facilitate the building and selling of only one condo.

Future developments will have their own company set ups

[blackcab]

5 minutes ago, Delight said:

The name of the company will be typically

 

'Name of Condo'   co., ltd

 

Quite often that is not the case, especially with developers with more than one concurrent project.

 

In most circumstances, the company will be used to move from one project to the next project.

 

If that's not working then like any other business the company might change direction. Changing the company's objectives and the company name is a straightforward matter.

 

On the other hand, closing down a company can be time consuming and costly.

[FritsSikkink]

14 minutes ago, Delight said:

 Perhaps I did not explain correctly

The name of the company will be typically

 

'Name of Condo'   co., ltd

 

The company is set up to facilitate the building and selling of only one condo.

Future developments will have their own company set ups

That wouldn't be a smart way of doing business. 

[Delight]

3 hours ago, FritsSikkink said:

That wouldn't be a smart way of doing business. 

  The building where In live is part of a development of 5 .

All   5 had there own separate companies.They all shared the same name with a suffix 1 or 2 or 3  or 4  or 5 

 

The building where I live for certain has not closed because one apartment has not transferred. The building came on stream 12 years ago. the owner has always paid his fees.

So should this company still be audited have AGM's etc?

[SLG]

Typically Developers build a condo and sell as many units as they can before it is completed and get progress payments before as construction is completed.  When the condo is complete they get a permit allowing occupancy and units are transferred to owners, a process that takes place at the Land Office in the area of the condo.  At the time occupancy is allowed a Juristic Person, which is essentially a Thai company, is formed and is necessary to be in place before title of the individual units are transferred to owners.  Normally these name of the Juristic Person is the name of the condo.  This is the entity that owns, operates and maintains the common area of the condos including the land.  The Juristic Person is the entity that bills owners for maintenance fees and sometimes utilities.  Units that are not yet sold remain in the name of the developers until they are sold.

[topt]

8 minutes ago, SLG said:

This is the entity that owns,

Correct me if I am wrong but do they actually "own" the common areas? I thought they "managed" them for the benefit of the condo owners?

[Delight]

4 hours ago, SLG said:

Typically Developers build a condo and sell as many units as they can before it is completed and get progress payments before as construction is completed.  When the condo is complete they get a permit allowing occupancy and units are transferred to owners, a process that takes place at the Land Office in the area of the condo.  At the time occupancy is allowed a Juristic Person, which is essentially a Thai company, is formed and is necessary to be in place before title of the individual units are transferred to owners.  Normally these name of the Juristic Person is the name of the condo.  This is the entity that owns, operates and maintains the common area of the condos including the land.  The Juristic Person is the entity that bills owners for maintenance fees and sometimes utilities.  Units that are not yet sold remain in the name of the developers until they are sold.

  Thanks for that detailed analysis of the system.

However before the 'Developer can build and sell' he has to form a company

My interest is what happens to that company when,lets say, all the apartments have been both sold and transferred?