Despite initial fears, the impact from the military coup on the real estate sector remained minimal as the take-over came as no surprise to local and foreign property investors in Bangkok, according to international property services firm JLL.
The company’s discussions with property developers, investors and corporate occupiers indicated that the coup came as no surprise, said Suphin Mechuchep, managing director of JLL Thailand.
She said most property players in Thailand appeared immune to the current political situation, which was one of disruptions the country had been through in the past. Experience showed that most of these disruptions were either short-lived or had limited direct impact on the real estate sector.
Economic crises had far more impact on the real estate sector.
“Capital and rental values in some property sectors in Thailand fell during the Asian Financial Crisis (1997-1998) and the Global Financial Crisis (2007-2008). But over the past seven months of pre-coup anti-government protests, capital and rental values in most property sectors have continued to grow,” said Ms Suphin.
She said the coup might scare off property investors who were new to Thailand, but regardless of the military's intervention new investors were less willing to enter the Thai market anyway, due to the political turmoil that the country has endured.
Property developers, owners, investors and occupiers have become more cautious since late 2013 with some of them adopting a wait-and-see approach.
“Having said that, it remains too early to tell if the military intervention could provide a solution to the country’s political deadlock and help reduce political uncertainty, or will have a negative or positive impact on the overall economy and the real estate sector in the later phase,” she added.