Mixed-use projects drive Lat Phrao
Completion of the skytrain's Sukhumvit Line extension from Kasetsart University to Khu Kot this year should mean increased traffic near Lat Phrao intersection, with developers planning mixed-use projects worth a combined 50 billion baht over the next few years.
Phattarachai Taweewong, associate director of research at property consultant Colliers International Thailand, said areas from Lat Phrao intersection to Chatuchak have Bang Sue Grand Station driving new traffic. The new railway hub is expected to carry more than 100,000 passengers a day.
The ongoing development includes the Mo Chit Complex worth 26 billion baht near the station, scheduled for completion in 2023, housing office and retail space totalling more than 70,500 square metres.
On Phahon Yothin Road opposite the Crime Suppression Division, there is a joint venture between BTS Group Holdings and the Boondicharern family, the former major shareholders of Grand Canal Land Plc. This mixed-use project will comprise office space, retail areas, a hotel and condos worth a combined 20 billion baht.
Near Lat Phrao intersection, Oasis Tower will offer office space worth 3.69 billion baht developed by SET-listed property firm Singha Estate Plc.
Commercial property developer UHG Holdings Co is also developing Ratchayothin Hills, comprising offices, a hotel, meeting rooms, fitness and retail space, slated for completion in 2023.
"These new projects will boost office supply to 170,000 sq m and draw 50,000 staff to this area," Mr Phattarachai said.
After the skytrain extension from Kasetsart University is completed in 2020, this location will become a new transport hub, he said.
During the past five years, a large number of condos were launched in this location, with sales prices soaring by 8% per year in the past decade.
According to Colliers, two new condo projects with a total of 1,910 units worth a combined 5.35 billion baht launched last year, following four projects with 3,014 units worth 15.9 billion baht that launched in 2018.
The average sales price of new condo supply last year in the Lat Phrao area was 146,240 baht per sq m, higher than the average of new Bangkok condos in 2019 at 123,130 baht per sq m.
Kayon Tantichatiwat, managing director of property consultant Bangkok Citismart Co, a subsidiary of SET-listed developer AP Thailand Plc, said Lat Phrao intersection has potential and is equipped with lifestyle facilities.
He said there are three shopping centres with 470,000 sq m of retail space, a transport hub servicing 540,000 passengers daily and 300,000 sq m of grade A office space for 40,000 workers.
From 2015-19, 11 condo projects totalling 8,263 units emerged on Phahon Yothin Road from MRT Phahon Yothin station to BTS Ratchayothin station.
The sales rate as of the fourth quarter last year was 74%.
The best selling locations are near Ha Yaek Lat Phrao BTS station with a sales rate of 82%, followed by Phahon Yothin 24 BTS station at 66% and Ratchayothin BTS station at 62%.
The average sales price of condos rose from 127,000 baht per sq m in 2015 to 170,000 baht in 2019, Mr Kayon said.
According to consultant Plus Property Co, a subsidiary of SET-listed developer Sansiri Plc, average land price in locations near Ha Yaek Lat Phrao BTS station was 620,000 baht per square wah, up 10% per year the past five years.
The sales rate of condo supply in Phahon Yothin-Lat Phrao was 57% in 2019, up from 54% in 2018 and 21% in 2017. The 2019 and 2018 sales rates were higher than those for overall Bangkok, which were 42% and 50%, respectively.
However, the average sales price of new condo supply dropped 5% to 125,000 baht per sq m last year with the influx of new supply added.
Suwannee Mahanarongchai, Plus Property's deputy managing director for business strategies and asset development, said lower prices boosted the sales rate by 21% to 22 units per project per month.
"The most outstanding segment was units priced between 80,000 and 130,000 baht per sq m, with a sales rate of 60%," she said. "The most popular units were priced between 3 and 4 million baht."
Ms Suwannee said the capital gain on condos in the location is 4% per year while the rental yield is 5% per year.