Despite high competition and a slowing market, small developer Fynn Development Co will launch a new low-rise condo project worth 1.8 billion baht on Sukhumvit Soi 10 as it is confident about demand and supply at the location.
Chief executive Pongsethorn Jom Salakshana said the company sees a positive trend in the property market this year because there is a coronation and general election are planned, which can help boost property value.
"It is common to have high competition in the condo market," he said. "We have secured land plots for future development, but we don't need to accelerate development or new launches."
Over the next few years, Fynn Development plans to launch four residential projects worth a combined 4 billion baht, including a townhouse with five units, two low-rise condo projects, and a high-rise condo in inner city locations.
On Jan 19, it expects to launch presales of Fynn Asoke, a low-rise condo project worth 1.8 billion baht on a 770-square-wah plot on Sukhumvit Soi 10. Fynn expects 50% of units to be sold within the first quarter, and to be sold out by year-end.
The project has two eight-storey towers and a total of 263 units sized between 24-120 square metres, priced at 185,000 baht per sq m on average, or from 4.5 million baht a unit.
Aliwassa Pathnadabutr, managing director of property consultant CBRE Thailand, said condo demand in central business district locations remains strong, but new supply launched during the past few years did not match with customer's needs.
"The sales price [of condos] is too high," she said. "But land prices have never dropped."
According to CBRE market research, the average asking price for a condo in the high-end segment was 277,541 baht per sq m in the third quarter of 2018, a 2.6% rise from 2017, driven by increasing land prices.
The highest average asking price was for riverside areas at 335,667 baht per sq m, growth of 4.3%. Second was central Lumpini at 291,667 baht per sq m (up 7.9%), followed by Sukhumvit at 256,278 baht per sq m, a gain of 0.9%. Fourth was the Silom-Sathon area at 223,750 baht per sq m, a rise of 4.2%.
In inner city areas, Sukhumvit was the most popular location, which has a large supply of new condos launched each year. The amount launched around Sukhumvit has never dropped since 2012, said CBRE Thailand.
"There are many plots available for new condo development along Sukhumvit Road. The locations also feature a lot of facilities, with a large number of expats looking for units to rent," Ms Aliwassa said.
"From this year the market will see a lot of changes, driven by an abrupt shift in consumer lifestyle and behaviour, with emphasis on health consciousness and wellness."