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Thailand Business News –

Condominium prices on Phloenchit and Chidlom on Wireless road were higher than other CBD locations with an average asking price of between Bt200,000 per square metre and Bt250,000 per square metre.

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Condo Prices Up $6600 per Sqm in Bangkok Central Areas

With a one-year total shareholder return (TSR) of 132% last year, property development was the SET’s third best performing sector, in stark contrast to 2008’s lacklustre -43%.

These cultural changes are evidenced in the type of housing recently launched. On the lower- to mid-end side, Supalai and LPN have launched projects in Ratchayothin and Ratchada with units ranging from 28 to 55 square meters and prices from 1.5-3 million baht, reflecting demand among single professionals and young families. On the higher end side, where prices are at or above 100,000 baht per sq m, the Sukhumvit and CBD areas remain the preferred location. The common point between all this? Easy access to BTS and MRT lines.

But if the government invests in mass transit routes, adding one or two new lines in the future, new residential and commercial areas will be created. Property tax incentives implemented by the government of Thailand to stimulate the sluggish market expired on May 30 as it was no longer a need for the tax breaks as the economy was recovering, the property sector had grown by 10% over the past year, and developers’ margins were improving. Governments have used tax incentives to stimulate the property market during most economic slumps since the 1997 Asian financial crisis.

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Siam Square Makeover in Pipeline

For 2009 as a whole, nonetheless, real GDP fell 2.3 percent despite a pick-up in consumption in the fourth quarter, external demand will be the main contributor to growth in the near term.
However, the upside is limited due to political and regulatory uncertainty, including from possible political violence and the Map Ta Phut court case. The government investment plan is proceeding at a slow pace, but public investment should contribute to growth.

Chinese investment funds, Middle Eastern petrodollars — there is a huge amount of new money being channeled into the Asian capital markets.
‘‘Only 35 companies on the SET have market capitalizations of more than $1 billion, with another 80 companies between $200 million and $1 billion.

The modern Thai capital market can essentially be divided into two phases, beginning with “The Bangkok Stock Exchange” which was privately owned, followed by the establishment of “The Securities Exchange of Thailand”.

The inception of the Thai stock market began as far back as July 1962, when a private group established an organized stock exchange as a limited partnership. The group later became a limited company and changed its name to the “Bangkok Stock Exchange Co., Ltd.” (BSE) in 1963.
Despite its well-intended foundation the BSE was rather inactive. Annual turnover value consisted of only 160 million baht in 1968, and 114 million baht in 1969. Trading volumes continued to fall sharply thereafter to 46 million baht in 1970, and then 28 million baht in 1971. The turnover in debentures reached 87 million baht in 1972, but stocks continued to perform poorly, with turnover hitting an all time low of only 26 million baht. The BSE finally ceased operations in the early 1970s.

It is generally accepted that the BSE failed to succeed because of a lack of official government support and a limited investor understanding of the equity market.

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J.W. Marriott unveils Songkran earlybird special offer

The telecommunications industry in Thailand is set for a busy year, with new 3G licences expected to be auctioned during the third quarter of 2012   At the end of 2009, real GDP was back at pre-crisis levels, as measured in seasonally adjusted terms. Policies that could contribute to reducing Thailand’s dependence on foreign demand include a phased liberalization of the services sector, boosting transport infrastructure, a reform of educational curricula and improved access and quality of higher education to boost skills of the labor force, better integration of universities, firms and government, and improved social safety nets

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Thai telecom industry set for a busy year (OBG update)

Lagging the chart was paper and printing materials, with a -1.3% TSR for 2009, professional services with a meager 4.5% gain, and property funds up 31%.The Shareholder Scorecard, published annually by the Bangkok Post and the AWR Lloyd-PYI group, is an analysis of the two factors that underlie investor returns — dividends and capital gains.
The 2009 market rally reflects the perception that valuations are about long-term potential, and that political crises in Thailand rarely have a dramatic impact on the fundamentals of the economy. If we look at the EV/EBITDA multiples of the oil and gas sector, for example, valuations are still low compared to regional peers : this is partly a reflection of regulatory risks and political instability in Thailand.

Thailand Business News –

House price boom in Asia now over Almost in all Asian housing markets in the survey, and performed more poorly in 2011, than during the previous year. House prices in Hong Kong were up 5.32% on the year, after rising 18.87% the previous year. House prices in Singapore rose a mere 0.28%, after a rise of 13.06% the previous year.

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House price boom now over in Almost all Asian housing markets

The SET index bottomed at 432 in December 2008 after tumbling from a high of 833 earlier that year. The index then levelled off in Q1/09, before working its way back to 560 in May. Triggered by positive pre-sale signs from developers, a reduction in construction costs and the government’s stimulus package, property stocks were among the first to bounce back. The SET’s revival reached a mark just 32% below its peak, in line with other world stock markets including the Dow Jones (-33%), Singapore Straits Times (-27%), the Hang Seng (-25%) and the FTSE (-27%).

The Bank of Thailand Monetary Policy Committee stopped cutting its key rate in May 2009 after seeing signals of a recovering economy. Many expect banks to adjust their rates down once rising confidence supports housing purchases, and promotion campaign launches to grasp home buyers.

As a result of declining consumer confidence during four consecutive quarters there has been a dramatic drop in sales of big ticket items such as vehicles (-33%). Bangkok housing registrations for single houses and townhouse units have also been hit hard, while investments and new mass transit lines have boosted market share for condominiums in the residential property sector, although the market demand as a whole has been lower. Transactions will most likely remain slow until confidence returns to both buyers and bankers, who finance property developers and their customers.

Many market observers and potential buyers were surprised that housing prices did not go down during the crisis — a reflection of the view that the market felt the situation was only temporary.

The market is based on people who will actually live in the units and less on speculators.

The mid to high-end segment boomed this year in Thailand as demand was wide and remained strong. The high-end will recover in the third or fourth quarter. But supply in this segment is very limited due to scarcity of land for new developments. Around 80% of the new launch in this segment was taken up. New supply in the high-end segment, now quoted at 150,000 to 200,000 baht a square metre, will be provided by developers with a strong financial status, experienced teams and products that match demand.
Currently, the MahaNakhon project is the only new high-end project in the pipeline. The Sukhothai Residence project on Sathorn Road, which is 70% sold, has frozen sales until demand can sustain the desired prices.

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Park Hyatt Bangkok due to open in 2014

The prime ministers of Thailand and Malaysia are promising deeper cooperation in an ongoing push against a low-level rebellion in Muslim-majority border regions separating the two Southeast Asian nations.

The pledge came Monday in a meeting outside Kuala Lumpur between Thai Prime Minister Yingluck Shinawatra and her Malaysian counterpart, Najib Razak. Both countries belong to the regional security grouping ASEAN, the Association of Southeast Asian Nations, which is urging Muslim separatists to reject violence and political extremism in southern Thailand.  

“Prime Minister Yingluck has requested Malaysia to provide whatever system and cooperation we can to help Thailand in the process towards the long term solutions in the South,” said Razak. “We both agreed that this is a domestic matter for Thailand and people in the South must not seek for a separate state, they must reject violence and extremism.”

Yingluck, on her first visit as prime minister to Muslim-majority Malaysia, praised the mutual help as essential to regional peace.

“We see our cooperation as a key to ASEAN community building, regional connectivity, peace and prosperity. With Malaysia scheduled to be ASEAN chair in the year 2015, Thailand is confident that the launch of ASEAN community will be in a good hand. We look forward to ASEAN being a key driver of economic growth and stability in [the] wider Asia Pacific region,” said Yingluck.

Yingluck’s one-day visit came as Thai authorities probe a failed bombing plot in Bangkok involving Iranian suspects and their alleged targets, Israeli diplomats.

Last week, one of two suspects in the alleged plot fled Bangkok to Malaysia, where he was arrested. Malaysian authorities have pledged full cooperation with Bangkok in the probe, but Malaysian police are still holding the suspect as they investigate the case. The second suspect is in Thai custody.

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Thai, Malaysian Leaders Hold Talks on Border Unrest

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Thai economy shrinks 10.7 percent after floods