SC Asset buying 30 plots for development
Demand for low-rise homes persists
SET-listed developer SC Asset Corporation plans to invest 25 billion baht in 2021-22 for the acquisition of at least 30 new plots to develop residential projects worth a combined 35 billion baht.
Chief executive Nuttaphong Kunakornwong said the new plots will be used for low-rise housing developments, including single detached houses, duplex houses and townhouses in Greater Bangkok.
"Real demand in low-rise houses remains healthy, particularly among those with cash," he said. "This sector will continue to be robust, even though the crisis is expected to last until next year."
He said despite there being demand in the condo market, a significant chunk of supply could still be left over.
As a result, a slow absorption rate will continue for another few years if no new supply is added.
By 2023-24, the sector will be able to come back as usual.
Mr Nuttaphong said the company is ready to invest, being equipped with financial liquidity of 10 billion baht and its lowest debt to equity ratio at 1.38 times, down from 1.58 times at the end of 2019.
This year it will launch 11 new projects worth a combined 17 billion baht, comprising eight low-rise housing projects worth 9 billion baht and three condo projects worth 8 billion baht.
About 60-70% of the new projects are set to be launched in the second half of the year as the company expects a recovery in the market sentiment in that period.
SC aims to have 19 billion baht in revenue by the end of 2020.
The presales target is marked at 20 billion baht, up from a record high of 16.6 billion baht last year, which rose from 14.42 billion baht in 2019. A key driver in 2020 was sales from low-rise houses, which grew 37% to 14.75 billion baht, said Mr Nuttaphong.
"We aim to be the market leader for single detached houses priced from 10 million baht after shifting to units priced 10-20 million baht a few years ago," he added.
This year the firm will launch a new brand for single detached houses, Venue ID, at Venue Rama 9 project. Unit prices are 5-10 million baht to accommodate Gen Y homebuyers. The design has a working space above the staircase.
Three years ago the company found 10% of customers were searching for a large single detached house with fewer bedrooms as they were single. They preferred rooms for hobbies or other interests instead of extra bedrooms.
In this quarter the new housing design, Baan Khon Sode (house for the single), was launched. Homes will have a pet door and customised designs in line with homebuyers' activities and interests.