Wealth management and business consulting firm IFCG Plc is expanding into overseas investment properties in the Maldives, Phnom Penh and Dubai to help clients diversify from Thailand's increasingly saturated condo market.
Withoon Lertpanomwan, chief executive of IFCG, said the company is working with a Thai developer on a resort and condotel project on an island in the Maldives, where the hospitality sector is experiencing significant growth.
"With occupancy rates reaching 100%, even during the low season, and robust revenue per available room, investing in the Maldives offers a faster break-even period of just 4-5 years, compared to a typical rate in the industry of 7-8 years," he said.
IFCG is negotiating lease terms with the island's concessionaire, considering a duration of 50 or 90 years, with investment costs of around US$7-25 million.
The second destination IFCG is dealing with is Phnom Penh where it is in discussions with a developer working on a new five-storey market mall and condotels. The mall's concept is to offer a variety of stalls and retail spaces for rent, catering to vendors selling a diverse range of goods, similar to Bangkok's Platinum Fashion Mall or Chatuchak Market.
"People in Phnom Penh love shopping at this type of market. It's reminiscent of MBK 30 years ago," said Mr Withoon. "We will secure a quota of half of the mall's total space to offer to our clients for investment and rental opportunities."
He said this type of investment in Phnom Penh has an expected yield of 9-12% per year, while market competition remains low.
In Phnom Penh, high-end condotels are a promising investment opportunity with a high rental yield because of limited supply and strong demand, particularly from an influx of foreigners into the capital, said Mr Withoon.
Dubai is another destination where investment properties are appealing, with a yield of 9-12% per year, as the city attracts many foreign visitors. The company is exploring investment opportunities in high-end villas and condos.
Founded in 2009 and specialising in property, IFCG has a total of 50,000 clients. Almost all its clients are Thai, although there are a few Koreans and Chinese nationals, too.
The firm manages an accumulated portfolio that is worth 100 billion baht in total.
About 40% of the portfolio is invested in properties, primarily condotels in Bangkok, with 30% invested in funds, 20% in insurance and the remainder in stocks, gold and other alternative investments.
The highest yield comes from property, averaging 10% annually, with returns from 8-12%.
"Property investment remains the most attractive option, as it generates both annual yields from rent and capital gains when offered for sale," he said. "However, with the appeal of Bangkok condos decreasing and rental yields of only 3-6%, we need to look overseas."