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The rise of the mixed use retail development

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The rise of the mixed use retail development | The Thaiger

As our lifeststyles continue to change and morph along with technological and social evolution, so too our living spaces and the locations we choose to live. Behavioural changes among urbanites have led to the rise of mixed-use projects in Southeast Asian countries, according to property experts.

Christian Olofsson, shopping centre & mixed-use director of IKEA/Southeast Asia, told The Nation that the competitive environment in the retail industry precipitated the new format of incorporating non-traditional elements into a retail complex. Development of mixed-use retail properties is growing with the inclusion of residential units, entertainment revenues and healthcare facilities in a single site.

Catering to the needs of today’s consumers and staying relevant is the goal of the re-think among major players, Olofsson said. The new strategy could bring higher return on investment if the developer optimises the opportunity and is able to better meet the needs of modern consumers than are single-use developers.
The concept is less risky as it comes with a greater variety of revenue sources. It can also help average out the land costs by integrating a mix of components with different types of incomes.

Given the positives, IKEA decided to develop a mixed-use project – Mega City – next to Mega Bangna, Olofsson said.

According to a report by the Council of Tall Buildings and Urban Habitat, 451 tall building are listed as under construction globally until 2025, of which a third are mixed-use projects combining hotels, residential units, offices, service apartments and retail outlets. In Southeast Asia, excluding Thailand, 16 mixed-use projects are currently under construction – eight in Malaysia, five locate in Indonesia, and one each in Singapore, Vietnam and the Philippines.

The rise of the mixed use retail development | News by The Thaiger

The Council on Tall Buildings and Urban Habitat is the world’s leading institute on the inception, design, construction and operation of tall buildings and future cities around the globe. Founded in 1969 and headquartered at Chicago’s historic Monroe Building, the council is a non-profit organisation with its Asia headquarters at Tongji University in Shanghai, a research office at Iuav University in Venice and an academic office at the Illinois Institute of Technology in Chicago. It facilitates exchanges of the latest technologies for tall buildings through publications, research, events, working groups, web platforms, and an extensive network of international representatives.

James Pitchon, head of Research and Consulting at CBRE Thailand, said it is not possible to develop a single-use project on a large site, citing the likelihood of oversupply in the local market, be it an office or residential project. Developers of large sites need a range of diversified incomes, he added.

Consumers like the convenience of having a range of facilities in one place that are easily accessible in a climate control environment. Having easy-to-reach retail outlets and a hotel in the same complex appeal to office tenants, especially for the convenience of foreign clients and visitors.

Thais are also open to the idea of staying in a condo next to where they work and play, provided it comes with privacy and exclusivity along with the convenience, Pitchon said.

The rise of the mixed use retail development | News by The Thaiger

A JLL research said that the growth of mixed-use projects in ASEAN (the Association of Southeast Asian Nations) began to take off amid infrastructure development and changes to consumer behaviours in the region. The association marked its 50th anniversary last year and the region is gearing up for greater growth and investment.

Already powerhouses in the wider region, Southeast Asia’s economies are projected to grow at an annual average of 5 per cent until 2020. The real estate industry stands to benefit as demographics and market size draw further investments, given the manufacturing and logistics advantages. The upgrade in ASEAN infrastructure, especially the advancement of high-speed rail networks, will attract development of mixed-use projects connected to the train stations, as is the case in Japan and Hong Kong, the research said.

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The rise of the mixed use retail development | News by The Thaiger

SOURCE: The Nation



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Phuket

Family of British Phuket property developer say “he was murdered”

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Family of British Phuket property developer say “he was murdered” | The Thaiger

PHOTO: Lawyer Vincent McOwen holding up a photo of Steven James Granville – Khaosod English

A lawyer representing the family of Steven James Granville has filed a complaint with the Technology Crime Suppression Division (TCSD) in Bangkok over police reports about injuries sustained in a 2013 ‘cycling incident’.

The TCSD is now overseen by Immigration Chief Pol Lt Gen Surachate Hakparn.

Karon Police wrote it off as a cycling accident at the time. But lawyer Vincent McOwen says the family were now coming forward as Mr. Granville died last year at the age of 52 after being brain dead and confined to bed in a UK hospital for four years.

Mr. Granville opened Puravarna Resort, a 800 million baht project set on 113 rai of land back in 2000. He was sentenced to jail for over a year for fraud in 2010.

He was charged for deceiving buyers into paying for homes at the project that were never built. Nineteen buyers claimed they had paid a total of 217 million baht but Phase 1 of the project had stalled and Phase 2 never materialised.

A report from 2010 involving the arrest of Mr Granville in a Phuket resort scam HERE.

He was released from prison after nearly 18 months , as outstanding criminal charges have been dropped over his involvement in the Purnavarna project in Phuket. Full report HERE.

A video walk-thru of the proposed Puravarna Resort published back in 2009

Lawyer Vincent McOwen, acting for Mr. Granville’s family, is asking for a full and fair investigation.

“It is an ongoing case but we are hearing nothing back. We are getting no feedback,” he said to Khaosod English.

The lawyer is asking police to investigate two former partners of Mr. Granville who were involved in another project in 2012. He alleges the pair asked Mr. Granville to transfer 99 percent of Puravarna Resort’s shares, valued around 1 billion baht, reasoning that his criminal record could affect the project.

According to the lawyer the siblings promised to return the shares within six months if a deal wasn’t forthcoming.

On June 24, 2013, three months later, after the shares were allegedly transferred, Mr. Granville was seriously injured in a ‘cycling accident’.

Mr. Granville’s family suspected foul play, despite the conclusion of Karon police and has lost 15 million baht in a losing legal battle to get back their property shares back.

The lawyer claims the only injury found at the time was ‘blunt force trauma’ to the man’s head. A police report says that there were no other wounds on his body.

Karon Police ruled the incident a cycling accident.

“This was not an accident. He suffered for four and a half years,” said Lawyer Vincent McOwen.

SOURCES: Khaosod English

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Chiang Mai

Phuket tram project seeks private sector investment

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Phuket tram project seeks private sector investment | The Thaiger

(The term ‘tram’ and ‘light rail’ are variously used to describe the new public transport project for Phuket.)

The Mass Rapid Transit Authority of Thailand (MRTA) is now inviting the private sector and local administrative bodies to get behind and invest in a mass-transit project in Phuket. The project is valued around 35 billion baht. The next rounds of talks and presentations are being held in Bangkok this Friday.

The main feature is a new 58.5 kilometre long light rail service valued at 34.8 billion baht. The tram route plans to run from Tha Noon in Phang Nga province, across Sarasin Bridge onto Phuket, past the airport, through Phuket Town on the east coast and then finishing at Chalong’s main intersection near the Chalong Circle.

The Phuket tram project has been divided into two phases: a 41.7 kilometre section from Phuket airport to Chalong intersection and a second phase, a 16.8 kilometre stretch from Tha Noon in Phang Nga to Muang Mai at the north end of Phuket, linking to the first phase.

The MRTA will contract the first phase which will have 21 stations. They expect to seek cabinet approval for the project in the middle of this year with construction likely to begin in 2020. They estimate it will be operational by 2023.

At this stage, the MRTA says tram fares will  be calculated based on the distance travelled but a maximum fare would not be more than be 100 – 137 baht. This would put the cost of daily use for many local Thais out of reach of their budgets (it costs about 80 baht to fill an average 110cc scooter which would last most of the week).

Phuket tram project seeks private sector investment | News by The Thaiger

An earlier rendering of the proposed route and stops for the Phuket Light Rail/Tram

Critics say the tram stops avoid most of the tourist hot spots along the west coast of the island and features on locals living along the main Thepkasattri truck route from Thalang to Phuket Town and then Chao Fah east to Chalong.

They also don’t believe that Thai users are likely to give up their point-to-point motorcycle transport for a more inconvenient, and expensive, tram that will necessitate them using expensive taxis, buses and motorcycle taxis at either end to get them to their destinations.

Critics also cite the three year construction period, which if following recent major road construction projects, is likely to blow out to four or five years and and the massive disruption of traffic during the construction time. They also believe the loss of road space along the route will restrict local road traffic even more, neutralising the nett gains of the new tram system.

The island’s Governor says Phuket is experiencing rapid growth and that traffic is getting worse, adding that an efficient mass transit system, was urgently needed to accommodate tourists (without explaining how the new light rail/tram would actually assist tourists).

The MRTA is also working on a three-route tram project in Chiang Mai. The red line would be worth 30.4 billion baht and the 11.9 kilometre Green Line would have 10 stations worth 36.2 billion baht. The Blue Line will travel from the Chiang Mai Zoo to Tha Phae-Don Chan.

Phuket tram project seeks private sector investment | News by The Thaiger

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Bangkok

Co-working space – not just for start-ups

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Co-working space – not just for start-ups | The Thaiger

PHOTO: HUBBA-TO co-working space in Bangkok

by Thanchanok Phobut | Senior Coordinator, CBRE Thailand

CBRE, an international property consultancy company, reveals that co-working space seems to be on the tip of everyone’s tongue these days. There was a time when no-one knew what the term “serviced office” meant or why someone would want such an option. But today, you can’t open a business publication without seeing an article about co-working. Most people think of co-working spaces as being a thriving hub of young latte-sipping, technology entrepreneurs, coming up with the next big idea that will make them multi-millionaires.

While there is an element of truth to this image, the end-goal for many co-working space operators is to change the way that companies, not just start-ups, source their office space. They want companies to pay for office space as a service rather than follow the traditional route of signing a lease, fitting out their own space, having an office manager maintain the premises and hiring their own employees for reception and administrative duties.

Co-working office operators usually offer companies their own private space. It is most common to be offered an office based on the size you will need to fit in a set number of desks. For example, if your company has four employees, your package offer will include a furnished closed office with four desks, 4 chairs and optional telecommunications equipment for four people (internet service, phone number and a telephone handset).

There is usually a common kitchen area and spaces to meet and mingle. Think of it like a five-star hotel, you’re not sharing a room, but you are getting a high level of service and amenities on the premises.

You usually have a short-term commitment, not signing a lease for years. The best deal is usually for a year or more, but you can lease your office for as short as one month. Starting and ending your relationship with an operator is most often quick and easy. Since the office is already outfitted and reception services provided, getting to work is much quicker than when you need to design your new space yourself or hire your own support staff.

“Competition in the space is red hot. As more and more offices pop up, the fight to achieve 100% occupancy is fierce. When shopping for your space, be sure to consider more than just price, as the services and reputation of your provider are just as important.

“If you do your homework, you’ll avoid the pitfalls of co-working space, such as unreturned deposits, unexpectedly thin walls between units or fees for things like coffee and copying that you didn’t expect. The great news is, changing providers is much easier than with traditional space,” states Mr. Nithipat Tongpun, Head of Advisory & Transaction Services – Office, CBRE Thailand.

According to a recent CBRE report on the New York City office market:

  • While traditional long-term leases are the preferred model for business and the foundation of the commercial office market, the rapid growth of third-party flexible space operators provides occupiers with a wide variety of options for leasing office space. Since 2013, when the expansion of third-party flexible space began to gain significant traction, the sector has averaged an annual growth rate of 22 percent.
  • There are strong indicators of user demand for the services of the third-party space providers. In fact, 75 percent of corporate occupiers anticipate including co-working or flexible space in their occupancy portfolio over the next three years.
  • Smaller users also continue to be an important part of the target market; as the flexible space footprint has grown in Manhattan, the amount of traditional leasing among tenants under 5,000 sq. ft. has dropped off by 42 percent between 2013 and year-end 2017, suggesting that these users are migrating to flexible space solutions.

In Bangkok, four large co-working space operators are opening in multiple locations. JustCo, Spaces, The Great Room and WeWork leased a combined total of 25,000 square metres of space in some of Bangkok’s best office buildings last year and they are still growing.

“I recently met Yvan Maillard, general manager of The Great Room‘s Singapore operation and he said that, in Singapore, 30% of his clients are late stage start-ups, 30 % are private investment family offices and 30% are mainstream corporates. In the case of corporates, they often lease co-working space as a stopgap before finding a larger permanent office for their expanding team,” said Mr. James Pitchon, Head of Research and Consulting, CBRE Thailand.

It is not only the way companies source their office space that is changing. Even those companies who continue to lease office space directly are changing the way that they use the space – having your own office or even your own desk is out of fashion – agile working is all the rage.

Mr. Nihipat added, “Companies are providing employees with a daily choice of environments from quiet space to a layout that enables teams to collaborate. Employees are expected to move around the office, depending on their tasks. The objective is to create a workspace that fulfills the employees’ needs in a high-quality environment, while minimizing the number of individual desks needed, effectively putting more people to work in less space.”

Globally and in Bangkok, the office market will continue to evolve and while traditional leases are yet to be seen as a thing of the past, CBRE expects more companies to provide agile working environments. CBRE also expects to see significant growth in the amount of co-working spaces provided by third party suppliers.

“This will mean an increase in the demand for high quality buildings with flexible, column free floor plates, technically advanced air conditioning and temperature control, as well as sufficient lift capacity to deal with higher rates of occupation density.

Many of the new generation of buildings currently under construction or being planned in Bangkok will have these features and we won’t be surprised to see more and more co-working spaces open their doors as companies weigh the real advantages of this option versus traditional space.

Co-working space - not just for start-ups | News by The Thaiger

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