Posh Condo Developers

[sharecropper]

I read recently in a rag whose name we dare not speak, that a Bangkok developer thinks Pattaya hasn't got enough "high end" condos and is planning another one for next year.

Perhaps they haven't notice that:

(a) the previously planned high end ones have gone bust, stalled or seem likely never be built;

( even if they were, there just aren't the foreign mugs blindly chucking their cash around to buy them, and they won't be flocking to Thailand or Pattaya again any time soon;

© there are even fewer (of the mythical?) wealthy Thais who want to live in overpriced Foreigner ghetto developments in Pattaya - immediately an unsold virtually 40% of your high end deveopment right there

(d) People would have to be naive bordering on insane to buy off plan right now.

Haven't they heard that Ocean 1 will swamp the Pattaya market with high end condos?

And how is that development going by the way. Any words from its real estate agent promoters or the developers themselves?

[Dpolenz]

Drug Money,washing money.

[crazygreg44]

I believe this is just the consequential enforcement of the age old plan , that Thailand, once it got rid of all the Farang Scum with only the wealthy and bald riches staying, will be the top holiday destination of middle and upper class chinese nouveau riches from the People's Republic. And they will start to invest soon, as Thailand is becoming their most southernward holiday destination in front of overcrowded Hainan Island. The numbers of Chinese tourists are constantly rising, and they will start flocking into the property market real soon with their buyers power. comes the day when Thailand does not need the "western" Farang any more, to keep it's tourism bustling. I guess this also is part of the scheme , it started with the visa rules change and will end up with beach properties in the hands of top end chinese tourists. At least that is what these developers are hoping for. So don t chuckle or start wondering at it . . just watch and believe !

[kurnell]

I believe this is just the consequential enforcement of the age old plan , that Thailand, once it got rid of all the Farang Scum with only the wealthy and bald riches staying, will be the top holiday destination of middle and upper class chinese nouveau riches from the People's Republic. And they will start to invest soon, as Thailand is becoming their most southernward holiday destination in front of overcrowded Hainan Island. The numbers of Chinese tourists are constantly rising, and they will start flocking into the property market real soon with their buyers power. comes the day when Thailand does not need the "western" Farang any more, to keep it's tourism bustling. I guess this also is part of the scheme , it started with the visa rules change and will end up with beach properties in the hands of top end chinese tourists. At least that is what these developers are hoping for. So don t chuckle or start wondering at it . . just watch and believe !

Interesting, but I don't think so.

[Abrak]

Why people even bother building 'posh' condos in Thailand is beyond me, nobody has really made any money out of it, with the possible exception of TCCC. The real action is in the low to mid end. LPN, which typically sells from Bt1.5m - Bt5m condo units, sold 2000 units over 2 days last weekend.

[sharecropper]

Why people even bother building 'posh' condos in Thailand is beyond me, nobody has really made any money out of it, with the possible exception of TCCC. The real action is in the low to mid end. LPN, which typically sells from Bt1.5m - Bt5m condo units, sold 2000 units over 2 days last weekend.

I agree with you completely on activity being in the low to middle end, but where did you get that figure of 2,000 units sold in 2 days last weekend -are you sure you (or your source) didn't mean 20?

[Abrak]

I agree with you completely on activity being in the low to middle end, but where did you get that figure of 2,000 units sold in 2 days last weekend -are you sure you (or your source) didn't mean 20?

As you can see, LPN launched 3,700 units at the weekend in two separate projects. The company said that it had bookings (not quite the same as a sale but they have a conversion ratio over 90%) for 2000 units with a value of Bt3.8bn. They have been quite reliable in the past.

http://www.nationmultimedia.com/2009/11/17...ss_30116733.php

[JimsKnight]

I believe this is just the consequential enforcement of the age old plan , that Thailand, once it got rid of all the Farang Scum with only the wealthy and bald riches staying, will be the top holiday destination of middle and upper class chinese nouveau riches from the People's Republic. And they will start to invest soon, as Thailand is becoming their most southernward holiday destination in front of overcrowded Hainan Island. The numbers of Chinese tourists are constantly rising, and they will start flocking into the property market real soon with their buyers power. comes the day when Thailand does not need the "western" Farang any more, to keep it's tourism bustling. I guess this also is part of the scheme , it started with the visa rules change and will end up with beach properties in the hands of top end chinese tourists. At least that is what these developers are hoping for. So don t chuckle or start wondering at it . . just watch and believe !

Yeah maybe in Thaksins wildest dreams that was a plan.

Thankfully i think that's gone the way of the dodo.

There is still a recession on you know...

[Abrak]

BTW if anyone is still cynical about mid to low end condo sales they can go to the LPN website - www.lpn.co.th.

One of the two projects they launched last weekend - Lumpini Villa Ladprao Soi Chokchai 4 - consisting of 1,020 units is marked under one of the banner headlines - SOLD OUT - See you next project. Now selling out your project in 4 days seems a very sensible strategy. Many high end condos seem to just spend the first 3 or 4 years trying to sell the units will by definition wipe out any profits you can generate by actually building the thing.

What say LPN understand is that your key to profitability is asset turn not margin.

[sharecropper]

I agree with you completely on activity being in the low to middle end, but where did you get that figure of 2,000 units sold in 2 days last weekend -are you sure you (or your source) didn't mean 20?

As you can see, LPN launched 3,700 units at the weekend in two separate projects. The company said that it had bookings (not quite the same as a sale but they have a conversion ratio over 90%) for 2000 units with a value of Bt3.8bn. They have been quite reliable in the past.

http://www.nationmultimedia.com/2009/11/17...ss_30116733.php

Phew. Thanks. We're talking about different markets -Pattaya and Bangkok.

In Pattaya I doubt 2,000 off plan condos have been sold in the past 2 years.

[ThaiSunshine]

BTW if anyone is still cynical about mid to low end condo sales they can go to the LPN website - www.lpn.co.th.

Shame this website is only in Thai language...would've loved to read about these priects!

Are they for Thai nationals only? I mean...I prefer western kitchen and bathroom

Oooopppsssss.....just found the English language button down in the bottom of the page

Edited November 25, 2009 by ThaiSunshine

[eljeque]

Regarding the Chinese buying here...? Why?

They are foreigners and they cannot own either.

They will not get a good return on their investment either, and it will not take long for them to find out that the buildings are not being maintained, and from then on, they will stop buying.

[PattayaParent]

Regarding the Chinese buying here...? Why?

They are foreigners and they cannot own either.

They will not get a good return on their investment either, and it will not take long for them to find out that the buildings are not being maintained, and from then on, they will stop buying.

Are you really saying that foreigners cannot own condos in Thailand

[eljeque]

"will be the top holiday destination of middle and upper class chinese nouveau riches from the People's Republic. And they will start to invest soon, as Thailand is becoming their most southernward holiday destination in front of overcrowded Hainan Island. The numbers of Chinese tourists are constantly rising, and they will start flocking into the property market real soon with their buyers power."

SEE ABOVE

This says property, not condos. Property is far more general and includes land / houses.

They will also see the 49% rule in condo ownership and will shy away from it.

[Barack]

sharecropper posted

"......

Haven't they heard that Ocean 1 will swamp the Pattaya market with high end condos?

And how is that development going by the way. Any words from its real estate agent promoters or the developers themselves?"

There is Facebook page for potential investors:

http://www.facebook.com/group.php?gid=3418...4277&ref=mf

[Basil B]

I agree with you completely on activity being in the low to middle end, but where did you get that figure of 2,000 units sold in 2 days last weekend -are you sure you (or your source) didn't mean 20?

As you can see, LPN launched 3,700 units at the weekend in two separate projects. The company said that it had bookings (not quite the same as a sale but they have a conversion ratio over 90%) for 2000 units with a value of Bt3.8bn. They have been quite reliable in the past.

http://www.nationmultimedia.com/2009/11/17...ss_30116733.php

Phew. Thanks. We're talking about different markets -Pattaya and Bangkok.

In Pattaya I doubt 2,000 off plan condos have been sold in the past 2 years.

Agreed, so many projects gone bust or just not started, there must be still loads of mugs out there...

[sharecropper]

sharecropper posted

"......

Haven't they heard that Ocean 1 will swamp the Pattaya market with high end condos?

And how is that development going by the way. Any words from its real estate agent promoters or the developers themselves?"

There is Facebook page for potential investors:

http://www.facebook.com/group.php?gid=3418...4277&ref=mf

That's an excellent link. Thanks.

In December to a sales enquiry they said (in a letter posted on the site)

There will be a further price rise when construction starts but right now the price per square metre is 137,500 Thai Baht for (levels 10 to 14), 143,000 Thai Baht (levels 15 to 50) and 148,500 Thai Baht (levels 52 to 85). All studios (levels 10 – 50) are 143,000 Thai Baht. ....and said the price can only go UP! If their building goes up as solidly as their prices, I am sure all buyers and Pattaya watchers will be happy.

It gave a start date of February 2010. If it breaks ground I will wish them well.

[123ace]

Mainland Chinese buyers are not a factor in any of the Thai markets as they are not allowed to take money out of the country, this myth that they want to buy here is only held by people who are 'arm chair commentators' on real estate. The PRC types that go to Pattaya are low end as well, with sod all real money. The growing group of hugely wealthy mainlanders that do buy overeas as they have HK bank accounts, are simply not buying in Thailnd due to risk, and there are far better options in Hong Kong and Singapore where they speak chinese and have real chinese food. Let alone mortgages and freehold.

As for a new super high end building in Pattaya, I agree this is a very bad time to launch. The developer has either not done any paid for research by a non-Pattaya broker - few do. Or, they are hugely wealthy and taking a ten year view on sales, this is also possible. I would wait until 2011 and see how the current top 6 competitors have fared (where sales is at an avg of 50% across this group) and monitor the currently stalled very high end projects that will also be tempted to re-start if the advanced supply has progressed.

Developing condos in pattaya is not a profitable business (even at the best of times) if you take the view that the profit is held in the last 15% of units - so with the total lack of Thai buyers, most sharply absent at the very high end, it can be considered a poor decision for a traditional condo route, unless you can secure Thai buyers due to the developers profile in Bangkok - although Reflections has been down that road.

Unfortunatley I know of some coming, so the situation will likley prevail.

[sharecropper]

Mainland Chinese buyers are not a factor in any of the Thai markets as they are not allowed to take money out of the country, this myth that they want to buy here is only held by people who are 'arm chair commentators' on real estate. The PRC types that go to Pattaya are low end as well, with sod all real money. The growing group of hugely wealthy mainlanders that do buy overeas as they have HK bank accounts, are simply not buying in Thailnd due to risk, and there are far better options in Hong Kong and Singapore where they speak chinese and have real chinese food. Let alone mortgages and freehold.

As for a new super high end building in Pattaya, I agree this is a very bad time to launch. The developer has either not done any paid for research by a non-Pattaya broker - few do. Or, they are hugely wealthy and taking a ten year view on sales, this is also possible. I would wait until 2011 and see how the current top 6 competitors have fared (where sales is at an avg of 50% across this group) and monitor the currently stalled very high end projects that will also be tempted to re-start if the advanced supply has progressed.

Developing condos in pattaya is not a profitable business (even at the best of times) if you take the view that the profit is held in the last 15% of units - so with the total lack of Thai buyers, most sharply absent at the very high end, it can be considered a poor decision for a traditional condo route, unless you can secure Thai buyers due to the developers profile in Bangkok - although Reflections has been down that road.

Unfortunatley I know of some coming, so the situation will likley prevail.

Thanks - informative post, especially on the never-appearing rush of high-end Chinese buyers.