SET-listed developer Supalai is bullish on the domestic and Australian residential markets, planning to invest 12.6 billion baht to expand 12 projects in Australia and launch a record high of 42 new projects worth 50 billion in Thailand.
Chief executive Prateep Tangmatitham said investments worth 50 billion baht in Australia between 2014 and 2023 were yielding success.
They include the development of 12 housing projects in four cities across three states.
"We aimed for a minimum initial return rate of 18%, but we achieved more than 20% as the Australian economy had an upswing after the 2008 crisis," he said. "We entered the market when it was bottoming out."
Following the first 12 projects in collaboration with six partners over 10 years, Supalai is venturing into an additional 12 projects in partnership with Stockland Corporation, one of Australia's largest listed real estate developers.
Last month, Supalai Australia Holdings Pty Ltd, a subsidiary of Supalai, and Stockland's subsidiary, Stockland Communities Partnership HoldCo Pty Ltd, established a joint venture named SSRCP HoldCo Pty Ltd, holding a 49.9% and 50.1% stake, respectively.
The joint venture firm signed an agreement to invest A$1.06 billion to acquire 12 projects in five cities across four states from Lendlease Corp Ltd, a local construction firm seeking to restructure. The project value for Supalai is 138 billion baht.
"We plan to invest in 12 projects at once as we are confident in the Australian housing market. One project is in Sydney, where we want to invest," said Mr Prateep.
Other projects comprise four each in Brisbane and Melbourne, two in Perth and one in Wollongong.
"Australia is a large country with stable economic and political conditions, abundant natural resources, high purchasing power and more foreign immigrants. It is also an education hub that attracts overseas students and is less prone to floods," he said.
Mr Prateep said this investment can enhance the company's long-term growth potential and help diversify risks.
The Australian projects are expected to contribute up to 20% of the company's total profits this year, an increase from 5-10%.
Investment in Thailand is no less significant as its finance cost was only 2.74% as of September 2023.
This year, it plans to spend 8 billion baht to buy new land plots and launch the largest number and highest value of new residential projects since its establishment 35 years ago.
These projects will comprise 38 low-rise housing projects worth 43.5 billion baht nationwide, with 16 projects worth 20 billion baht in Greater Bangkok and 22 projects worth 23.5 billion baht in provinces including Lop Buri, Ratchaburi and Lampang, which are new destinations this year.
The remaining four projects will be condos, with two worth 5 billion baht in Bangkok and two worth 1.5 billion baht in the provinces.
"There is a chance to launch more than we plan if the market is good," said managing director Tritecha Tangmatitham. "We are bullish on low-rise houses as they are more flexible than condos."
This year, Supalai aims to have 36 billion baht in presales, a growth of 25% from 28.8 billion baht in 2023, which dropped from 32.4 billion baht in 2022, while revenue is expected at 36 billion baht.