The Ritz-Carlton pushes Bangkok’s property status up another notch
Bangkok gets a lot of ink in property news outlets (including this one) for good reason. Thailand is a perpetual investment hotspot due to its strong economic outlook, reasonable currency and relatively low prices within Asia. Now Bangkok is stepping into the branded residence market; the Residences at St Regis are enjoying strong sales, and the Ritz-Carlton is next up to the plate.
The Ritz-Carlton Residences, Bangkok will be perched atop the city’s newest prestige tower, MahaNakhon. Designed by Office for Metropolitan Architecture’s Ole Scheeren (the mind behind the cubist CCTV Building in Beijing), MahaNakhon will soar 77 storeys above the heart of Bangkok’s CBD between the Chao Phraya River and Lumpini Park. When completed in 2014, the mixed-used development will incorporate MahaNakhon Square (which will include a Dean & Deluca store), The Cube and its outdoor plaza, a boutique hotel, and the Ritz-Carlton residences, all attached to the Chong Nonsi station of the BTS Skytrain. The building’s prism design, with its rough spirals, cuboidal surfaces and cantilevered floors, gives it a unique pixellated appearance.
“For purchasers looking for a self-living residence, MahaNakhon is an ideal option given its prime location … as well as top-class management. For investors, this is certainly a valuable investment opportunity,” says Rebecca Shum, Executive Director, Investment & Project Marketing of MahaNakhon’s sales agent, CB Richard Ellis.
Developed by Industrial Buildings Corporation and Thailand’s Pace Development, MahaNakhon is in keeping with Pace’s home-grown focus. The tower will feature a public observation deck on the top (with private access for residents and hotel guests), a small indicator in the developer’s faith in the local market. “Locally in Thailand it would be fair to say the last 12 months have been a challenge for real estate developers. There has been some perception, which has been addressed recently, about improved political conditions. But the market is performing extremely strongly, and we’re seeing renewed interest from foreign buyers,” begins Kipsan Oslo Beck, chief marketing officer for Pace. But no one is in any hurry to sell the units as fast as possible. A slow rollout began in February and Pace predicts 45 percent of the units will be sold by year’s end. By the time the building is finished, Beck expects the buyer balance to favour local owner-occupiers.
“It tends to be investor heavy at the front end. So far we’re running at slightly more than half buying for investment. We know local Thais will buy when they can walk in and see it. When they can see it physically and compare it, ‘Do I want floor 8, 9, or 10?’ they’ll buy. And they’re willing to pay a premium for that.”
Another of Bangkok’s strengths as an investment hub right now is its caution. Recalling the crash in Dubai that led to a revised image of the city, that of a crane-dotted example of overreach, Beck concedes the domestic market is taking advantage of hindsight the same way the investor is. “I think that’s a very valid concern for a foreign buyer that’s looking at another market. Is there a real demand, is there real interest in the type of property,” he states. But interest from Thai buyers is growing steadily in step with the city. Affluence and population numbers are on the rise, and, “There’s a distinct shift, supported by statistics, of the family unit becoming gradually smaller; people live at home less time than they did before. [Bangkok] is starting to touch on Hong Kong/Singapore conditions. If you want to live in the city it’s no longer possible to live in a home,” Beck notes. “Infrastructure growth … has made real changes to the market that are driving specific interest in specific areas.”
Pace is taking cues from the region with regards to the appeal of branded residences too. There are no branded residences in, say, Hong Kong either, but similar developments do exist — such as the ICC, where the new Ritz-Carlton Hotel is located. “We’re able to see the trend and the sales philosophy and jump the trend a little bit. There are no hotel residences in Bangkok, so it’s difficult to explain something in a market where it’s never existed,” Beck reasons. That said, the market for super-luxury should pick up when properties like the St Regis and Pace’s own Saladaeng come online.
The 194 non-hotel stock units at the Ritz-Carlton Bangkok Residences range in size from 1,200 to 8,500 square feet in two- to (sold-out) five-bedroom configurations that can be outfitted with contemporary classic (the more popular) or contemporary modern furnishings. Purchases are also free to take advantage of after-sale service to find a local designer. Units start at approximately THB27 million (HK$7million). Some units have oversized terraces, some do not; no two floors are alike and as a result very few units duplicate elsewhere, a decision made before design even began, and “Ritz-Carlton” says all that needs to be said about the residences’ management. Finishes Beck, “Each owner can be proud that they own something that really is unique.”