On the tail of a construction boom lasting the best part of two decades, Bangkok now suffers from a glut of condominiums, with Bloomberg reporting in May that some 65,000 new apartments were added to the Thai capital last year alone, an 11 percent increase on 2017.
Although it’s been claimed that there are now as many as 450,000 residences sitting unsold across the sun-drenched “Land of Smiles”, and snapshots of more-ordinary properties are yellowing sadly in real-estate agency windows from Hat Yai to Chiang Rai, one sector of the market remains in fine fettle, mainly through demands of the domestic market, but also supported by a steady influx of foreign capital.
That sector is luxury.
“The luxury end is pretty resilient, though the mid and lower end of the market has fallen off, certainly compared to last year,” says Tim Skevington, managing director at Richmont’s Luxury Real Estate, which represents Christie’s International Real Estate in Bangkok.
Skevington is speaking in early August, from an exclusive gathering to celebrate the grand opening of Banyan Tree Residences Riverside Bangkok, a luxurious freehold condominium tower comprising 133 luxurious units over 45 floors, all overlooking the Chao Phraya River. A large turnout is expected.
“Particularly Thai people but also potential buyers from overseas,” says Skevington, who has more than 15 years experience in Bangkok’s high-end residential market. “That’s an indication of where we are. There’s still a lot of interest in the higher end in Bangkok.”
Thailand’s economy has wobbled in 2019, and tightened borrowing rules kicked in earlier this year. The result is what Bloomberg has dubbed “tepid” demand across the Bangkok property market as a whole (with developers reporting an overall new-project take-up rate of just 55 percent). The steamy City of Angels, however, is still one of the most attractivedestinations on the planet for high-end homes.
There are multiple reasons for this, says Apichart Chutrakul, CEO of leading full-service real-estate developer Sansiri PCL, which is behind some of Thailand’s most sought-after addresses. They range from high build quality and the creative input of megastar designers to a plethora of value-added services and amenities that increasingly come as standard.
Most attractive of all, however, is the fact that gateway prices are a fraction of those in Hong Kong or Singapore.
As a rule of thumb, Skevington says luxury properties in Bangkok should be considered those with buy prices upwards of 250,000 baht per square metre (roughly HK$5,920 per square foot). “And then we have super-luxury, which would be from around 350,000 baht [about HK$8,300 per square foot],” he adds. “That’s where we and Christie’s are positioned.”
Real estate consulting firm CBRE, meanwhile, defines “premier” residences as those requiring 300,000 baht per square metre, with about two-dozen Bangkok developments fitting the top-end bill at the close of 2018.
Sansiri recorded overall sales of US$1.5 billion that year, up 25 percent from 2017, and the company is currently bullish. Its sales target for the three years from 2019 is US$5 billion. This year alone, Sansiri will launch close to 30 new projects worth US$1.5 billion. It now boasts four super-premium properties in its Sansiri Luxury Collection.
That fab four includes the company’s first branded condominium project, Khun by Yoo. With construction to be completed in November, its 27 storeys will house 148 residential units ranging from one-bedroom apartments (440-570 square feet) to ultra-luxurious penthouses (3,165-3260 square feet). Interiors described as “playful” come courtesy of legendary French design whizz Philippe Starck, and the average buy price currently hovers at about 380,000 baht per square metre (HK$9,000 per square foot).
“Top-tier buyers can achieve a high degree of design, service and personalisation at prices that are approximately four times less than Hong Kong,” Chutrakul says, singing Bangkok’s praises. “All within one of the world’s most popular and vibrant cities, and a global gateway.”
Also in Sansiri’s Luxury Collection are Regency-styled, single-house development Baan Sansiri Pattanakarn and prestigious 45-storey condo tower The Monument Thong Lo, which features bespoke trimmings by Bohemian hand-blown glass specialist Lasvit.
In 2018, the most desired of 77 units in the collection’s 98 Wireless — Sansiri’s 25-storey, beaux arts-inspired residence, with interiors by New York-based designer Anne Carson (formerly interiors guru for Ralph Lauren) — were being offered for as much as 700,000 baht per square metre (about HK$16,575 per spare foot), making it the priciest residence in the Big Mango.
While Thailand is no stranger to occasional financial turmoil, it’s frequently argued that, with tourism being a major driver of the economy, buyers here enjoy a coincidental level of protection when investing long-term in Bangkok’s more exclusive properties. While the Southeast Asian kingdom can be knocked down, its natural charms mean it always bounces back.
According to Mastercard’s Global Destination Cities Index, Bangkok has been the world’s most visited city every year since 2015 (ahead of London and Paris). International arrivals last year hit 38 million; 41 million are expected this year. The more high-net-worth of these visitors, perhaps lured by Thailand’s intoxicating brew of gorgeous weather, convenient regional access and high-end bang for the buck, might jet home with a shiny new home in the portfolio.
Ease of condominium purchase, says Chutrakul, is another convincing factor. “In other major cities in Asia,” he argues, “it’s almost impossible to obtain freehold land in prime locations, whereas Thai property law allows foreigners to buy and own up to 49 percent of the total area of a condominium on a freehold basis.”
Skevington’s years of experience tell him that the largest percentage of foreign buyers in Bangkok luxury are from Hong Kong, with Singaporeans traditionally taking second place, only recently to be eclipsed by mainland Chinese. “Hong Kong interest has been steady for many years,” he says. “Singapore has been more up and down. Mainland Chinese are more recent buyers. The rest are mainly from Asia, but also from all across the world. But the majority are still Thai.”
Foreign purchasers account for as much as 30 percent of Sansiri’s sales, with investors from Hong Kong and mainland China making up the lion’s share (even with China’s economic slowdown and capital controls limiting cash outflows), followed by buyers from Singapore. But purchasers in Bangkok real estate are increasingly choosy and not every luxury property is a sure-fire winner.
As prime downtown land becomes ever more scarce (land prices in the city centre jumped 30 percent in 2017 alone) and the market becomes more selective, location is key. The most obvious port of call for the savvy luxury buyer is what Chutrakul calls Bangkok’s “Golden Triangle” of the Siam district, Sukhumvit Road and Lumphini Park. Home to 98 Wireless, this sprawling downtown area accommodates most of the city’s premium real estate – far too many options to list here in total.
In-demand developments include the recently completed Nimit Langsuan, a super-luxurious 53-floor landmark, just north of Lumphini, with 187 freehold residences ranging from 840 square feet to around 6,460. Nearby Magnolias Ratchadamri Boulevard is a mixed-use development overlooking the racetrack of Royal Bangkok Sports Club. It houses 316 residential units in a sculpted 60-storey tower (homes at Magnolias Ratchadamri Boulevard are leasehold, with 50-year terms, meaning lower buy prices than at Nimit Langsuan). The building will also house Southeast Asia’s first Waldorf Astoria hotel.
Longer-in-tooth is Marque Sukhumvit, a freehold condominium complex beside the Emporium shopping mall on Sukhumvit Road at Phrom Phong. Completed in 2017, Marque contains 149 units with 3.4 metre-high ceilings; the plushest also feature private plunge pools.
Just one stop east on Bangkok’s convenient Skytrain sits the Thong Lo neighbourhood, home to Sansiri’s The Monument Thong Lo and Khun by Yoo. Thong Lo has transformed in the past decade to become Bangkok’s most happening entertainment zone, chock-full of stylish eateries, Instagrammable bars and nightclubs, cute coffee joints and boutique hotels.
Tela Thonglor, completed last years and developed by Gaysorn Property (from the same group of companies responsible for the chic Siam shopping mall Gaysorn), is another condo complex to include on the shopping list. “Thong Lo is attractive to investor buyers looking to rent out, because there’s a lot of tenant demand in that area,” says Skevington.
Unlike many other cities internationally, Bangkok was unfathomably slow in exploiting the waterway that meanders through its heart, but that’s also changing. Three new ultra-luxury branded residences have recently debuted on the Chao Phraya’s banks: the aforementioned Banyan Tree Residences Riverside Bangkok, Four Seasons Private Residences Bangkok, and The Residences at Mandarin Oriental Bangkok. And keep your eyes peeled for Magnolias Waterfront Residences, which will be the city’s first residential-only super-tall tower.
Skevington says Bangkok’s riverside traditionally lacked the facilities and mass-transit convenience of more downtown locations such as Siam and Sukhumvit, but that’s no longer the case. “Just outside the Banyan Residences is the brand-new Gold Line monorail [to begin operation next year], and Iconsiam shopping complex has opened next door,” he points out. “Until quite recently, the riverside lacked these amenities and was quite difficult to get to, but all of that is changing.”
Skevington believes luxury buyers are considering what they will do with a Bangkok property, and choosing locations to suit. “Many luxury residences are bought for ‘lifestyle use’ — as a holiday home or as a pied-à-terre, or for their friends to use,” he says. “With that type of purchaser, a lot are now looking at the riverside. I’d say investors are looking at city-central locations, and lifestyle users are leaning towards riverside.”
After location, it should be noted that Bangkok in the 21st century is a mature luxury market. While the quality of facilities, fittings and finishes remains paramount to a property’s success, a state-of-the art fitness centre, pool and sauna, and the inclusion of top European brands such as Bulthaup, Franke, Dornbracht, Hansgrohe and Bang & Olufsen, no longer cut it in turning the most discerning heads or opening the fattest wallets.
As well as securing the services of A-list designers Starck, Carson, Gert Voorjans, Lorenzo Castillo, Hutton Wilkinson, Mary Fox Linton and others for the Sansiri Luxury Collection, Chutrakul says the current trend is for the finest residential properties to supply “luxury bespoke services” and “curated experiences”.
To this end, Sansiri — which will collaborate in a residential project with Tyler Brûlé’s lifestyle brand Monocle in coming years — has partnered with concierge specialist Quintessentially. This has allowed the developer, Chutrakul says, “to deliver high levels of personalisation to residents, such as securing tickets to the most exclusive sports and entertainment events, seamless hotel and travel arrangements, reservations to the most exclusive restaurants and anything you can think of that’s legal and moral”.