|
|
| • EXCH RATES |
|
Baht/$ 34.04/08 (Bid/Ask)
|
GOLD |
13,300
|
|
KANANA KATHARANGSIPORN
Despite the threat from fuel prices and inflation, retailers still see opportunities for expansion, with planned investments estimated at 90 billion baht by 2011 for new spaces totalling one million square metres, according to the property consultant Colliers International Thailand.
Approximately half of the new supply would be located in Bangkok boundary areas, especially in the eastern zone due to the pace of development near Suvarnabhumi Airport. Most of the new developments would be community malls, said Risinee Sarikaputra, senior manager of Colliers' research department.
''Higher oil prices have changed consumer behaviour. Those working or living in Bangkok boundary areas and outer areas are increasingly spending time closer to home,'' she said.
Among the supply would be an investment from an Indonesian retailer that plans to develop 15,000 square metres on Sathon Road.
At the same time, many retail developers in Thailand plan to move to other places in Asia including India, Vietnam and China. They would reduce their business risk from currency fluctuation by opening more outlets abroad through franchising.
Although Vietnam is an interesting country for retail due to its fast-growing economy, Thai retailers including Index Living Mall and Central Pattana Plc are holding back on investment and are monitoring the world economic situation.
During the first half of the year, new supply added to the Thai retail market totalled 151,584 sq m. About 49% consisted of shopping malls, followed by community malls at 44%. The current supply of retail space was 4.86 million sq m with overall occupancy f 94.2% as of the end of June.
Ms Risinee said investments in retail expansion in the provinces would be worth 14 billion baht this year with another 4.4 billion spent on renovation.
Asharawan Wachananont, director of Colliers' retail department, said hypermart and supercentre expansion would continue in anticipation that the new retail law would make development more difficult, as well as to support growth in suburban residential markets.
Various brands are expanding to cater to the needs of customers in all demographics; however, the key obstacles to expansion are acquiring good locations and reasonable rental rate.
She said retail centres situated in prime locations with high-quality retailers would achieve higher rental rates that could range from 1,500 to 3,000 baht per sq m a month.
The average rental rate in intermediate areas ranged between 1,400 and 2,800 baht a sq m per month while that in Bangkok outskirts ranged from 1,000 to 1,500 baht. The rents vary depending on the nature of the business, size of space and location.
Fashion business would be charged 1,800 to 2,800 baht per sq m a month while restaurants would be charged 800 to 1,400 baht.
Prospects in the second half of the year would depend mainly on local politics and the cost of living as they affect consumer confidence and purchasing power. Retail complexes providing essential products experience less impact from the slowing economy.
Colliers is currently the sole agency for two retail projects. One is Center Point at CentralWorld, covering 6,000 sq m and with a current occupancy rate of 60% at rents between 1,100 and 2,500 baht a sq m. It is scheduled to open in the fourth quarter of the year.
The other development is The Horizon on Sukhumvit Soi 63 developed by the apartment developer First Ekamai with 1,821 sq m at 1,000 to 2,000 baht per sq m. Occupancy is 25% and it will open in early 2009.
It is also studying retail development and doing a master plan for retail spaces totalling 30,000 sq m at new government centre in the Chaeng Watthana area.
Prev
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
Next
