Thailand’s Sansiri charts course for future

By Lin Zhiqin

/ EdgeProp |

May 7, 2018 7:00 AM SGT

Singapore is a key market for Thai property developer Sansiri Public Co, says CEO Apichart Chutrakul. The company is Thailand’s market leader in the foreign buyer segment. This year, it aims to increase sales to foreign internationals by 40% to THB13 billion ($550 million), with Singaporeans accounting for THB1.3 billion, or 10% of the international sales.

Chinese nationals are expected to make up the biggest source of this revenue stream at THB5.22 billion of international sales by value, followed by Hong Kongers at THB4.35 billion. Buyers from Taiwan, another key market for Sansiri, are expected to contribute THB630 million of revenue. The company also plans to expand into South Korea and Japan this year.

Apichart: We believe things will change, and planning for the future will ensure our survival

To tempt both foreign and local buyers, Sansiri will offer an abundance of choices by launching 31 projects worth nearly US$2 billion ($2.6 billion) this year. This is a 65% increase in total gross development value compared with the 14 projects with US$1.2 billion in GDV launched in 2017. The projects will span the whole gamut of property types, from condominiums to townhouses and detached houses, with the majority (77%) in Bangkok and the remainder in other areas, including Chiang Mai, Pattaya and Phuket.

Established in 1984, Sansiri has been listed on the Stock Exchange of Thailand since 1996. According to Sansiri, it had a portfolio of more than 320 projects as at last September. It has set itself apart from other developers with subsidiary Plus Properties, which enables it to provide a more complete suite of services in addition to property development. They include consultancy and brokerage services, project sales, property management and concierge service.

Strategy of partnerships

Sansiri has charted a strategy of long term partnerships with leading companies and government agencies to entrench its position as Thailand’s leading and only full-service developer. Last November, Sansiri invested a total of US$80 million in six international brands, which are in “highgrowth sectors in global markets that offer new sources of revenue”.

The six investments “are all related to Sansiri and there’s synergy”, says chief operating officer Uthai Uthaisangsuk. “We are trying to incorporate more into our homes. Everything we do is for the customer.” They are Singapore-based co-working operator JustCo; hotel booking app One Night; smart indoor farming solution provider Farmshelf; London-based Airbnb management company Hostmaker; hospitality group Standard International; and London-based media group Winkontent, which publishes the popular Monocle magazine.

Uthai: We are trying to incorporate more into our homes. Everything we do is for the customer

Sansiri’s Singapore office operates out of JustCo at UIC Building. The co-working operator will open four centres in Bangkok this year, which will “bring clients better working conditions”, says Apichart. Hostmaker has operations in London, Rome, Paris and Barcelona, and it will expand to Bangkok this year to offer its home rental management service to Sansiri’s customers. There are also plans to develop Standard and Monocle branded residences, the first of which is likely to be in Thailand. “The strategy is to partner with internationally renowned brands and bring them to Asia,” says Apichart. “We can facilitate [their entry].”

In 2015, Sansiri and BTS Group — a Thai mass transit operator and real estate developer — announced a joint venture (JV) to develop 25 projects worth a combined THB100 billion over the next five years. The condos are branded “The Line” and located near transport nodes.

The first among them is The Line Jatujak-Mochit, located near Mochit BTS station and Chatuchak MRT station and completed last year. All 841 units were sold out when it was launched for sale in May 2015; 200 units were snapped up by buyers from Singapore and Hong Kong. Subsequent projects under this brand, such as The Line Sathorn and The Line Sukhumvit 101, have also proven popular with Singaporeans, according to Sansiri. The Line Sathorn is fully sold, with its 327 units going at an average of THB270,000 psm ($1,050 psf). The Line Sukhumvit 101 has 778 units, of which 30% (223 units) are still available at an average price of THB160,000 psm. The condo is located between Bang Chak and Punnawithi BTS stations and is slated for completion in 2020.

Last year, Sansiri set up a JV with Japanese department store operator and real estate developer Tokyu Corp to develop a THB2 billion project called taka Haus in Bangkok’s Ekkamai district. The first condo under the “Haus” brand was designed to cater for the lifestyles of both Thais and Japanese, but has also appealed to Singaporeans, who form a high proportion of buyers. All 269 units have been sold since it was launched last September and it is slated to be completed next year.

Launched last September, taka Haus is the first project by Sansiri and Tokyu

Building communities

Two of the most recent projects by the Sansiri and Tokyu JV are oka Haus and kawa Haus, which were launched late last year. Located on Rama 4 Road, the 1,178-unit oka Haus is billed as an urban resort. It will have a co-working area, a shared communal cooking space called a co-kitchen and a sky lounge that leads to the rooftop garden with an outdoor theatre. International buyers have snapped up 20% of the 648 units sold at oka Haus.

The 1,178-unit oka Haus is billed as an urban resort and is 55% sold

The sky lounge at oka Haus will lead to the roof garden

Meanwhile, kawa Haus is billed as a modern resort for those who seek a slower pace of life. It comprises 546 units in three seven-storey buildings and is located at Community T77.

kawa Haus comprises 546 units in three seven-storey buildings

Community T77 is a cluster of developments by Sansiri that is located on an 8ha site by a canal in Bangkok’s On Nut district. Other projects in the cluster include Blocs 77, The Base Sukhumvit 77, The Base Park West, The Base Park East and Hasu Haus. There is also Habito, a three-storey mall developed at a cost of THB400 million to serve the 5,000 households that live near it.

Community T77 is a cluster of developments by Sansiri in On Nut district in Bangkok

Community T77 holds special meaning for Ou Baholyodhin, who was appointed Sansiri’s first chief creative officer in February. Ou was creative director for renowned Thai silk company Jim Thompson and settled on The Base Park West when he needed a condo.

“I was really particular when house-hunting,” Ou recounts. Apart from its location — five minutes from his office — The Base Park West is “part of a community, had lots of greenery and there was the mall. It wasn’t just the condo but the whole lifestyle”, he explains.

The Base Park West, where Ou lived, is part of Community T77

Charting the future

According to Ou, a key real estate trend is the shrinking size of housing units because of affordability. Although this is not as prevalent in Bangkok as it is in Hong Kong and Singapore, it is important to start thinking about how people can continue to enjoy a good living experience in the future, he says. One way would be to provide good-quality communal space, explains Ou. “If there are 600 units and we allocate an extra one sq m each, there would be 600 sq m of additional communal space for them to enjoy.”

In addition to the gym and pool, the space could be used for meeting and socialising spaces “like co-working spaces or hotel lobbies”, says Ou. “We don’t want people to pour their life savings into buying a property and then have to entertain their friends and family elsewhere.”

Ou: The new generation values experiences, so we want to involve them in the process of creating their perfect home

To help steer Sansiri “to become a developer of intelligent properties that will shape the way people will live in the future”, Ou will helm Sansiri Creative Studio, a team of designers that will oversee property design and also focus on personalisation and customisation with the aim of giving customers a more engaging experience. “The new generation values experiences, so we want to involve them in the process of creating their perfect home,” says Ou.

Another initiative is a research unit named Haus 2025, whose task is to anticipate what will happen in the next seven years, explains Uthai. “What kind of houses would people like to have then?” he asks.

“By that time, the millennials will be about 27 years old and [form our main clientele],” says Apichart. “We believe things will change, and planning for the future will ensure our survival.”

This article appeared in the EdgeProp Pullout #829 (May 7, 2018)

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