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Phuket’s new Environmental Rules hit island development

Bill Barnett

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Phuket’s new Environmental Rules hit island development | The Thaiger

By Bill Barnett of c9hotelworks.com

A new set of guidelines that quietly come into law late last year are set to alter the state of real estate  and hotel development in Phuket.

The revised regulations were issued by Thailand’s Ministry of Natural Resources and Environment and apply to Phuket Province.

Perhaps the most significant amendment is that buildings are no longer allowed on slopes of 35% incline and above, wherein in the past the threshold was 50%.

For slopes of 25-35% incline, rules now require 70% green area, limit cut and fill to one metre and requires that large boulders and trees (exceeding 500mm in girth) not be removed. This zone also limits building footprints to 90 square meters and for elevations below 40 meters restricts height to 40 meters and above 40 meters to six meters high.

Speaking to Phuket-based design and planning experts Original Vision (Thailand) the up side for the amended guidelines waves the IEE process for small hotel and property developments of 29 units/keys or less. Hence only a construction permit is required, but GFA cannot exceed 1,500 square metres.

An IEE (Initial Environmental Examination) is still required for property or hotel projects of 30 units/keys or those that fall within a development GFA of 1,500 to 4,000 square metres.

The more complex EIA (Environmental Impact Assessment) process is still required when exceeding 80 units or keys and an area above, 4,000 square metres in GFA.

Phuket’s new Environmental Rules hit island development | News by The Thaiger

What is important to understand is that the new regulations also must be referenced to the Phuket City Plan and Provincial set-back rules. Locations continue to have an overlay, and there are area specific regulations in Phuket City, some areas in Patong and nuances between the West and East coast.

It is clear that the new regulations are a more determined focus by the Thai government on slope control and green areas which looks to create a more challenging regime for property and hotels developers in land parcels that have significant terrain.

For any prospective developers out there, we strongly suggest obtaining a professional opinion on the revised regulations and how they may affect any prospective plans that have not been submitted for approvals.

As to who are the winners and losers for development?  Hillside condominium projects certainly will become more difficult as will cliff hugging hotels. While smaller boutique projects now have an advantage of no IEE processes. End of the day, Phuket is a winner with greater focus on badly needed environmental protection.



Find more property for sale and rent across Thailand at Thaiger Property, powered by FazWaz. You can even list your property for free.

Bill Barnett has over 30 years of experience in the Asian hospitality and property markets. He is considered to be a leading authority on real estate trends across Asia, and has sat at almost every seat around the hospitality and real estate table. Bill promotes industry insight through regular conference speaking engagements and is continually gathering market intelligence. Over the past few years he has released four books on Asian property topics.

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Bangkok

Chinese move their purchase power away from Bangkok condo market

The Thaiger

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Chinese move their purchase power away from Bangkok condo market | The Thaiger

Chinese condo buyers are veering their purchase power away from the Bangkok property market citing the strong Thai currency, overpricing and a supply glut.

  • 2015 – 5.8 Yuan to the Thai Baht
  • 2019 – 4.4 Yuan to the Thai Baht

Chinese move their purchase power away from Bangkok condo market | News by The Thaiger

The rise of the baht and the weakening of the Chinese Yuan over the past four years, have culminated in a 25% softening in Chinese investment power in the Thai property market (chart from xe.com)

Property consultants say that Chinese buyers are now containing their investment risk by buying into the lower-end 2-6 million baht condo market instead of the 5-10 million baht condos they were previously purchasing.

At the same time the annual returns for Bangkok condominiums is reported to have dropped from 6-7% five years ago to only 3-4% in some locations in the current market.

Speaking to the Bangkok Post, Simon Lee, President of property brokerage Angel Real Estate Consultancy, says overall sales volume of Bangkok condos bought by Chinese buyers will shrink by half in 2019.

He also notes that the current Thai government crackdown on investors renting out condos on daily or weekly leases, has scared a lot of new investment into the sector away  as the ‘law’ appears to be applied in a haphazard manner.

The Chinese investors are also expressing disappointment when they buy into a development at one cost, only to find that locals pick up the balance of the stock at a lower price as the developers clears the stock.

Bangkok’s soaring land prices, which should see the value of condos rise, is being balanced out with the sheer glut of stock available, pushing down values. Rental returns are also being pushed down by the volume of stock available to the rental market.

SOURCE: Bangkok Post

Here’s another report about signs of weakness emerging in the Bangkok condo market from The Thaiger.

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Property

Thai PM acts on illegal and unlicensed hotels and accommodation

The Thaiger

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Thai PM acts on illegal and unlicensed hotels and accommodation | The Thaiger

Owners of shop-houses, rented properties, even entire floors of condos – running them as defacto hotels – are about to get the Article 44 treatment.

The PM, acting in his capacity as the head of the NCPO (in the days before it is dissolved), says he will bring an estimated 20,000 illegal hotels and accommodations around the country under control so they run under the same rules as licensed hotels and to boost safety for paying guests.

The order cited a number of safety rules, like properly installed and operating fire extinguishers, required under the Hotel Act but usually missing in unlicensed premises, posing safety concerns for people that stay at unlicensed hotels.

He said they’ve been flaunting loopholes and dodging proper town planning guidelines for the past decade, taking advantage of Thailand’s tourist boom but operating ‘under the radar’ and not paying the proper taxes or licensing their properties.

“Many people lease their buildings, houses or apartments in the same manner as hotels without permission or proper management.”

He’s gone further and asked hotel owners or citizens that know of illegally operated establishments to tell local officials so they can be closed down or given a chance to properly license the properties. Unlicensed or illegal premises will be given 90 days from last Wednesday when the order was announced in the Royal Gazette.

The order covered issues relating to land management and town planning restricting locations that hotels can be constructed or operated.

Thailand is flooded with illegal accommodation offerings such as rented shophouses being converted into rooms or sets of rooms or entire floors in new condos being sub-let to operate as defacto hotels – some even with full receptions to welcome guests. The hotel industry, suffering under increased competition from illegal operators, has been forced to lower room rates to unsustainable levels in recent years. Hotel associations have been lobbying the government for urgent action.

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Bangkok

Luxury condos change the face of Sathorn Road in Bangkok

The Thaiger & The Nation

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Luxury condos change the face of Sathorn Road in Bangkok | The Thaiger

by Somluck Srimalee, The Nation

From Sathorn junction to Taksin Bridge, the riverside section of Sathorn Road has been transformed from a strip of shophouses to luxury residential condos in a gentrification that added 8,000 new apartments to the area. As well, the businesses have shifted to a more modern trade to replace the traditional trades.

With the market trend, listed and non-listed property firms are parading to launch their new condominium projects in Sathorn district, the central business district of Bangkok. Launches totalling more than 31 billion baht have been made from mid-2018 through the first half of this year, according to the recent Nation survey.

Supalai Icon Sathorn, worth 20 billion baht, is the latest project launched to market by Supalai. It is priced at 175,000 baht per square metre with a starting price of 8.2 million baht per unit.

Supalai’s CEO Prateep Tangmatitham said the mixed-use project would feature residential along with offices, shops and complete facilities on a 12,600 sqm plot, 56 floors high. The combined total of 780 residential will offer a functional area of approximately 150,000 sqm.

Meanwhile, other property firms are also launching their condo projects on Sathorn Road.

To find all the latest Bangkok condos for sale, and compare prices, go HERE.

For example, in the middle of last year Pruksa Real Estate introduced the Reserve Sathorn worth 2.59 billion baht – it has already sold out. The project offered a 280,000 baht per sqm starting price, or 13 million baht per unit. The project will be completed and transferred to customers in 2022.

Sathaporn Estate last September introduced its 1.3-billion baht Shade Sathorn condominium project at a 135,000 baht per sqm price, or 3.69 million baht per unit. The project is to be completed and transferred to its customers in 2021 or 2022.

The latest condo project is the 3.4 billion baht Anil Sathorn by Grand Unity Development. It goes for 260,000 baht per sqm, or a starting price of 11 million baht per unit.

From 2003 through 2018, a total of 8,002 condominium unite, valued at over 40 billion baht, were launched for sale on Sathorn Road. Up to 95% were successfully sold, according to research by property agency Colliers International Thailand.

Their research also found an average condominium price on Sathorn was at 250,000 baht per sqm.

Luxury condos change the face of Sathorn Road in Bangkok | News by The Thaiger

Most property firms that launched sales for over 40 billion baht worth of condos on Sathorn Road in 2018 through the first half of this year have successfully sold out, Colliers local research director Pattarachai Taweewong said.

For example, Reserve Sathorn launched mid-year and has managed to already sell out. Reflecting the demand, condominium prices also increased from the pre-booking 280,000- 300,000 baht per sqm.

Sansiri in 2017 launched the Line Sathorn worth 4 billion baht. The project combines 327 units at Bt270,000 per sqm and a starting price of 7.9 baht million. The project sold out within a day of opening up to booking. Those units now enjoy an average resale price of 285,000 baht per sqm.

Raimon Land last October introduced its 4.2 billion baht Tait 12 project on Sathorn Soi 12. At 264,000 baht per sqm, it offers a starting price 7.6 million baht per unit, and reached sales of 70% for the sales launched.

Sathorn Road is a prime location for residential property, says Pruksa Real Estate’s chief executive director of premium units. Prasert Taedullayasatit pointed to the locations many lifestyle-oriented facilities, including a hospital, university, primary school, secondary school and shopping centre.

The location also boasts both MRT and BTS transit lines, giving an added boost to demand for residential projects in the area. Meanwhile, the area’s limited availability of land for building residential drives up the price of land there, he said.

For 2018, land price around Sathorn Road were recorded at an average 2 million baht per square wah. Already, the price has jumped 10 per cent, while demand for residential in the location enjoys continuing strong growth, he said.

SOURCE: The Nation

Luxury condos change the face of Sathorn Road in Bangkok | News by The Thaiger

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