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Thailand’s retail and property markets adapt and move online

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Tourism, property, retail – 3 sectors of the Thai economy that have taken a huge hit from the impact of lockdowns and border closures. Whilst most of the lockdown provisions are now lifted, the borders remain mostly closed and the economy ‘sluggish’ at best.

The first half of 2020 has been one of the most challenging periods that Thailand retail industry has faced, probably ever. CBRE, an international property consultant, reveals that the degree of uncertainty in the second half of 2020 remains high. Retailers and developers alike must be adaptive and boost their e-commerce penetration to survive.

Thailand’s Covid-19 measures were put in place to contain the virus, but retail, the property market, along with tourism, has taken a significant hit.

“What we have been seeing in the past three months are brand-new challenges that took everyone by surprise. For around two years, we have been saying that those who cannot adapt quickly enough to the shifting retail landscape will not survive, but this is on another level. Retailers have to change their business operations not only to match the drastic drop in footfall but to accommodate a new way of shopping” – Ms. Jariya Thumtrongkitkul, Head of Advisory & Transaction Services, Retail, CBRE Thailand.

The retail sales index in May 2020 has dropped by 34% year-on-year, mostly from the decline in sales of cars and fuel. The Consumer Confidence Index dropped to the lowest point since 1998 at 47.2 in April but has managed to stumble back to just over 50 in July. While Thailand’s same-store-sales growth for Q2 has not been released, it is expected to indicate negative figures from both food and non-food retailers, as this period represents the time when most of Thailand was in some degree of lockdown and retail closure.

After the easing of business restrictions started in June 2020, CBRE notes that many landlords continued to restore their businesses by stimulating customers’ purchasing power via a variety of sales and marketing strategies, grand sales events and setting up frequent mall activities to help both permanent and temporary tenants. A few provided more flexible rental terms to retain existing tenants.

CBRE also witnessed that retailers who used to rent a bigger retail space turned to online platforms and are now refocusing their businesses online after the crisis, resulting in resizing or cancelling their current rental spaces in many retail centres. The move ‘online’ was simply accelerated by the impacts of the pandemic.

According to the Asia Pacific Retail Flash Survey conducted in May 2020, the majority of F&B and other experiential retailers will be focusing on opening fewer stores or focusing on smaller footprints for the second half of the year.

“Once the situation returns to normal, resizing existing rental space will become a more and more important approach that tenants take to be more cost-effective, especially for small and medium ones. Shopping mall operators thus need to revise their trade and tenant mix allocation more granularly and carefully.”

Thailand’s Covid-19 experience has accelerated the changes of traditional retail businesses and accelerated the growth of online retail business at the same time. CBRE notes that developers could reconsider the development concept of new malls to better suit the changes in shopping behaviour and better adapt to any unexpected events in the future. Convenience, hygiene, flexibility and online will be emphasised more for future retail developments.

CBRE believes e-commerce penetration will not be an option but a must for both brick and click businesses to survive. However, the Thai retail sector will be slow to fully recover unless tourist arrival figures reach a similar level to the pre-crisis period as many large-scale shopping malls, especially in downtown Bangkok, are fuelled by foreign tourists.

For property, sales have seen a sharp decline in demand from customers and agents report a risk-averse market. The price of new opening units from many developer companies has dropped significantly in line with the lack of customer demand at this time.

• Ananda Development, a leading company in the property market, is offering special prices on projects near BTS and MRT lines. The price reduction campaigns include a free transfer of ownership and five years of free common expenses.

• Lumpini Development is another leading company offering special prices. Their campaign includes a special discount of up to 50 per cent on existing projects.

• Supattra Kaewkwang, a property agent in the Bangkok area, says that she has been facing hardship since mid-February as both Thai and foreign customers are afraid of the travel restrictions throughout the country. The ongoing border ban and widespread economic recession, in Thailand and overseas, has caused a decline in her sales of up to 50%, compared to 2019.

But Brennan Campbell, CEO for FazWaz, notes that there is also considerable pent-up demand and searches on their website are still strong, along with reliable enquiries still coming through their office.

“In the early stages of the Covid disruption, we saw strong enquiries from, particularly, the Chinese and Hong Kong buyers. In recent months, despite the lack of tourist traffic, we’ve also started to see more European and SE Asian customers start to look at Thailand as a safe and reasonably priced market to invest in as the world starts to re-open.”

Thailand's retail and property markets adapt and move online | News by The ThaigerThailand's retail and property markets adapt and move online | News by The Thaiger

SOURCE: CBRE

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1 Comment

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  1. Avatar

    Preesy Chepuce

    August 25, 2020 at 1:52 pm

    The property market is forever trying to talk itself up and defy gravity. House price growth has been waiting to crash for years. There is no “pent-up demand”, there is a giant bubble & unsustainable personal and corporate debt.

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Crime

Mother abandons 3 young children in their locked Bangkok room for 3 days

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Mother abandons 3 young children in their locked Bangkok room for 3 days | The Thaiger
PHOTO: Khaosod.co.th

3 young Bangkok children were abandoned in a small room for 3 days after the mother allegedly visited her new boyfriend. A neighbour was taking care of the youngest of the 4 children, a 4 month old baby, but the mother never contacted anyone about her other 3 kids. The mother hadn’t returned to pick up her baby from the neighbour, as promised. Police report that the 3 children had no food for the 3 days. Paveena Hongsakul from the Foundation for Children and Women called Police at the Khan Na Yao Police Station, a northeastern suburb of Bangkok.

Police received a report about the 4 children, aged 7, 6, 4 and the baby.

The 25 year old stepsister notified the foundation on Thursday informing police that her 32 year old sister, Gift, is the mother of the children. Gift’s husband is serving a sentence for drug charges and has been incarcerated for 3 years. Since then Gift had the 4th child, although the family is unsure who the father is. The sister claimed that Gift was always asking the family for financial assistance.

Last Monday Gift’s neighbour contacted the sister saying that she had been taking care of the young baby. She went to Gift’s room to see if she was there and the room was locked. She checked through a window and could see the 3 other children and noted that they were stressed and looked hungry.

When she asked the children about their mother the youngsters remained silent. She worked with the other neighbours to rescue the children through the window. Gift’s phone was left in her room. After filing a report with the local police the neighbour took the other 3 children in to care for them but told police that her room was only 33 square metres and there were 11 people living in her tiny room already.

Police and the neighbour tried to call Gift’s new boyfriend. Eventually he answered but told them that he was “far away and didn’t know when Gift could return”.

All 4 children are now safe at the foundation after a visit to the local police station as police wait to interview Gift when she returns.

SOURCE: Thai Residents | Khaosod.co.th

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Thailand

Charter vote delayed, committee formed and Senators escape Parliament by boat – VIDEO

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Charter vote delayed, committee formed and Senators escape Parliament by boat – VIDEO | The Thaiger
PHOTOS: Protesters gather outside the Thai parliament - Tanaporn Choopanya

Thailand’s MPs and Senators have kicked the constitutional can down the road at least a month after the parliament failed to agree on charter amendments. A panel will be sent up to examine 6 motions that were proposed and debated over the past 2 days. Meanwhile, up to 2,000 protesters were gathered outside the unfinished parliamentary buildings as an act of solidarity for the MPs supporting the changes to the current Thai Constitution.

The reality of the vote, and the setting up of an investigative committee, could push any votes on real reform well into 2021.

The 2 Houses of Parliament voted 431-255 to delay the vote. Opposition Pheu Thai and Move Forward MPs stormed out and missed the opportunity of nominating anyone to the new 45 member parliamentary committee to examine the motions, whilst the remaining members chose members for the committee. Move Forward Party’s, Pita Limjaroenrat, described the vote as “a way to stall for time” complaining that the decision “was moving the country towards a dead end”.

It was not known how the NCPO hand-picked Senators would vote on the bills. Many were thought to side with the idea of constitutional reform but the reality was that, in most scenarios, they’d be voting themselves out of a job if any reforms went ahead. Thailand’s entire upper house is a military-appointed rump of conservative former businesspeople and Army officials, mostly men.

Charter vote delayed, committee formed and Senators escape Parliament by boat - VIDEO | News by The Thaiger

The protesters viewed the afternoon’s proceedings as a blunt stalling tactic to keep the current parliament, and its unelected senators, in power. The session ran until 8.30 last night. Rather than face the angry mob of anti-government protesters at the front of the building, most of the senators escaped on boat at the rear of the building, which backs onto Bangkok’s Chao Phraya River.

The demonstrators, with a consistent theme of reform over 3 months of rallies, are demanding changes to the current constitution because it was drafted by the NCPO who kicked out the elected government of Yingluck Shinawatra in 2014.

The protesters specifically point to the NCPO-appointed senate and the power they wield to elect the country’s prime minister, even though none of them were elected (nor was Prayut Chan-o-cha).

Protesters say they will now organise the next lot of rallies in October. Meanwhile, the Parliament is now is recess.

PROTESTSLive scenes from today’s protest rally to lend their voices, albeit from outside the The Parliament, to the debates inside about amendments to the Thai Constitution. The Thai parliament buildings are unfinished and, so it seems, are the student and anti-government protesters.

Posted by The Thaiger on Thursday, September 24, 2020

 

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Road deaths

Bangkok DJ dies in high speed crash on notorious ‘death road’

Caitlin Ashworth

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Bangkok DJ dies in high speed crash on notorious ‘death road’ | The Thaiger
PHOTO: INN News

A well known local DJ died early this morning in a high speed car crash on a Bangkok road bend nicknamed “Curve of 100 Deaths.” Police say his car’s speedometer was found stuck at 200 kilometres per hour.

Police suspect 33 year old Annop Poonsripattana was going around a curve when he lost control of the car due to the slippery road conditions from the rain. His black Toyato Altis was found smashed into an electricity pole around 2:30am today. The impact caused Annop to be flung to the back seat. Police say his skull was shattered and his neck broken.

A security guard at a nearby building says heard an explosion and the electricity cut out. The entire area went black, he says. The so called “Curve of 100 Deaths” is near Ratchada Criminal Court in Bangkok’s Chatuchak district. The guard says many fatal crashes happen on the road.

“This area is highly prone to road accidents. Just last week a mother and her small child were killed here.”

The Ratchada Road curve so dangerous that locals honk when driving through the curve to show respect and to ask for permission from the spirits of those who have died there for safe passage, according to Coconuts Bangkok. In the past, many people have left offerings like zebra statues in honour of those who died in car incidents while driving on the road.

Annop played music at many entertainment venues in Bangkok. He was also a contestant in the Take Me Out Thailand TV show in 2015. An autopsy is being done at the Police General Hospital. Electricians are working to fix the electricity pole and restore power.

Bangkok DJ dies in high speed crash on notorious ‘death road’ | News by The Thaiger

An event with Annop Poonsripattana.

SOURCES: Nation Thailand | Coconuts Bangkok

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