Newly launched units in the first half of 2011 were significantly higher than the total launched in the whole of last year. This was due to two new projects being launched in the first half of 2011 with more than 1,400 units per project.
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H2 2010 - H1 2011 SUPPLY LAUNCHES PRICES TAKE-UP PATTAYA CITY CONDOMINIUM MARKET REPORT THAILAND www.colliers.co.th Pattaya City Condominium Market HIGHLIGHTS More units were launched onto the market for the first half of the year compared with the whole of 2010. Around 1,000 units were supplied in Pattaya for H1 2011. A large listed developer made a strong vote of confidence in Pattaya city with its first launch in the city with a significant number of units. The second home market is being targeted for H1 in particular through large scale developments. The Pattaya growth story continues apace. MARKET INDICATORS H1 2011 (HALF YEAR) | CONDOMINIUM Newly launched units in the first half of 2011 were significantly higher than the total launched in the whole of last year. This was due to two new projects being launched in the first half of 2011 with more than 1,400 units per project. Source : Colliers International Thailand Research NEWLY LAUNCHED IN H1 2011 NEW LAUNCHES POWER PATTAYA MARKET
Transcript
H2 2010 - H1 2011
Supply
lAuNCHES
pRICES
TAKE-up
Pattaya City Condominium market rePort
THAIlANd
www.colliers.co.th
Pattaya City Condominium MarketHIgHlIgHTS Moreunitswerelaunchedontothemarketforthefirsthalfoftheyearcomparedwith the whole of 2010.
Newlylaunchedunitsinthefirsthalf of 2011 were significantlyhigher than the total launched in thewholeof lastyear.Thiswasdue to two new projects beinglaunchedinthefirsthalfof2011with more than 1,400 units perproject.
Source : Colliers international thailand research
NEwly lAuNCHEd IN H1 2011
NEw lAuNCHES powER pATTAyA mARKET
PattaYa citY condominium rePort market|H12011(HAlfYeAr)
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dESCRIpTIoNPattaya isacity locatedontheeastcoastoftheGulf of Thailand about 165 km southeast ofBangkok.Itiswithin,butnotunderthejurisdictionof Amphoe Bang lamung in the province ofChonburi.ThecityofPattaya isaself-governingmunicipality that covers the whole Tambon ofNongPrue,NaKlua,partsofHuaiYaiandNongPlalai.Itislocatedwithintheheavilyindustrializedeastern Seaboard zone, along with Sri racha,laemChabangandChonBuri.Ithasapopulationof556,916andcoversanareaof49.37Sqkm.
Pattaya city occupies most of the coastline ofBanglamung(oneofthe11districtsthatcompriseChonburi Province). It is divided into a largernorthernsectionthatspanstheareastotheeastof Naklua beach (themost northern beach) andPattayabeach(themainbeach),plustheBuddhaHillheadland(immediatelysouthofPattayabeach),and a smaller southern section covering the area totheeastofJomtienbeach,which liesdirectlysouthofBuddhaHill.
The reportcoversthePattayacityareaaswell asNaJomtienandadistinction is made between Pattaya city and Pattaya bay whichconstitutespartoftheoverallareaunderconsideration.
AttheendofH12011,thetotalsupplyamountstoapproximately45,600units. forH1 2011,more than 1,000 unitswere added to supply andnearly2,900unitsarescheduledtobecompletedinthesecondhalfof2011.
Thefoundationforthecondominiummarketoccurredin1992withthedevelopment of large scale condotel style properties such as MetroJomtien. Thiswas the result of theCondominiumAct in 1989whichopened the door for the development of high rise residences. InitialdemandcamefromforeignbuyersasThaisdidnotprovidethesignificant
enginefordemandastheydonow,althoughmanywerebeginningtobenefitfromtheeconomicboomandconsequentlypurchasingproperty.The next surge in growthwas the result of the economic boom thatpeaked in 1997 before the fall. Amore limited but sustained level ofsupplycameontothemarketinthefirstfewyearsofthenewcenturybutpickedupinthelatterhalfofthelastdecade.
Supply
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PattaYa citY condominium rePort market|H12011(HAlfYeAr)
CumulATIvE Supply IN BANgKoK
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TheinitialsurgeinsupplyinthecitywasdominatedbyPattaya.Howeverin1997asignificantadditionwasmadetoJomtiensupplybytheJomtienBeachCondominiums(knownasrimhat).Thetwoareascontinuedtobethemaintarget fordevelopmentsupto thepresentday.JomtienhassinceovertakenPattayaduetothegreateravailabilityofland,especiallyclosetothesea.ThePratumnakandWongamatareashavedevelopedona lower trajectory of growth over this period. from the year 2005
onwards, Wongamat has increased dramatically with the addition ofnearly 3,000 units in the past six years and is now on a par withPratumnak. Na Jomtien has been the laggard, primarily due to theabsenceofaroadrunningalongthecoastandavailable land inmoreaccessiblelocationsinthecity.
The largest condominium supply is in the Jomtien area, representingabout41%ofthetotal,followedbyPattayaarea,atabout31%.
CondominiumprojectsinthePattayaareaarepredominantlylowriseinnatureandtheaveragenumberofunitsperprojectisapproximately140,whichissimilartoprojectsintheWongamatandPratumnakareas.ThefigureforJomtienareaisaround360unitsasmostoftheprojectsarehigh rise buildings. The pattern of overall real estate development isdifferent forPattayaandJomtien.Pattayacontainsthe lion’sshareofbothhotelandretailprojectsleavinglimitedsizedlandspaceavailableforlargerscalecondominiums.Jomtienwaslargelysparedthisprocessinthe1980’sand90’sandasaresultsizabletractsoflandwereandstillremainavailableforlargerscaleprojects.
Source : Colliers international thailand research
Source : Colliers international thailand research
Supply By zoNE
CoNdomINIum Supply By loCATIoN, H1 2011
PattaYa citY condominium rePort market|H12011(HAlfYeAr)
CumulATIvE fuTuRE Supply By yEAR ANd loCATIoN
NEwly lAuNCHEd uNITS IN H1 2011 By loCATIoN ANd HAlf yEAR
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Source : Colliers international thailand research
Source : Colliers international thailand research
Morethan2,900unitsarescheduledtobecompletedandtransferredduringthesecondhalfof2011whichrepresentsanincreaseofjustover6% in total supply and more than 4,100 units are scheduled to becompleted and transferred in 2012. During the years 2011 – 2013
PratumnakissettobethemainplayerinthePattayacitycondominiummarket,duetomanyprojectsbeing launched in thepast threeyears.Thisareaisespeciallypopularforthesurgingrussianmarket.Alsomostprojectsarelocatedonthehillwithgoodviewsoverlookingthebeach.
NewlaunchesforH12011weremorethandoublefromthesecondhalfof last year. The Wongamat area contained by far the most highestfollowedbyJomtienarea.ThemainreasonforthenumberforWongamatis due to thenewproject by lPNDevelopmentPlc. Jomtien’s strongshowingisaresultofthelaunchofalargenewprojectbyA.D.HouseCo.,ltd.
lPNDevelopmentPlc. launched itsfirst ever condominiumproject inPattaya city on Sukhumvit road in the Wongamat area. lumpini
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Source : Colliers international thailand research
CoNdomINIum pRojECTS wITH HoTEl mANAgEmENT
dEmANd
ThetrendforresidenceswithhotelmanagementorahotelcomponentistakingshapeinPattayacitywithfourprojectsonthemarketadoptingthismethod.Theadditionofsuchabrandaddskudostothedevelopmentaswellassignificantfacilitiesandservicesavailabletounitownersandthosewhochoosetorent.Theupshotisthatcapitalvaluesarelikelytoincrease with the addition of a hotel element.
During thefirst sixmonths, threenewprojectswere launched in thePattayaareawithapproximately700unitsandmostofthemwereputonthemarketinthelasttwomonthsoffirsthalfof2011.Thishadadirectnegativeimpactonaveragetakeupratesinthearea.AnewprojectwaslaunchedintheJomtienareacontainingmorethan1,500units,which
TheaveragetakeuprateinWongamatareawasthehighestwithover70%whichresultedfromthesuccessfullaunchofthefirstPattayacityprojectfromlPNDevelopmenteventhoughthisprojecthasatotalofmore than 1,400 units.
NonewprojectwaslaunchedintheNaJomtienareabuttheconstructionprogress of the current developments in this area has shown goodprogress which has lead to greater confidence leading to improvedsales.
Source : Colliers international thailand research
TAKE-up RATE of lAuNCHEd pRojECTS SINCE 2010
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AddITIoN of populATIoN ovER 65 IN SElECTEd CouNTRIES
Significantnumbersofretireeswillcomefromcountriesthatarelargemarkets for the Pattaya tourist industry and consequently potentialresidents in the future. With lower government pension provisionsexpectedintheeraofthegreyingbabyboomers,manyinthewestmaychoosetolivetheirremainingdaysinacountryofferingthemabetter
IncontrasttotheBangkokmarket,foreignerstakeupthelion’sshareoflowerendcondominiumsinPattayaandJomtienasmanyareretireeswith limitedfinancialresourcesandforeignBangkokresidents lookingforaninexpensiveholidayhome.Thishasmeantthatforunitsbelow2millionBaht there isoftenadual pricing structure resulting fromthe49% foreigner owner limitations. In the newly emerging upmarketresidentialmarketsofWongamatandPratumnak, localbuyersarethemain driver and there are far fewer dual pricing policies.Often localbuyersareattractedbybetterpaymenttermscomparedtoforeignbuyersandthereforethedevelopersfinancingstructurecanhaveasignificantbearingonthelocalbuyingcomponent.
Therussianmarketisaparticularlystrongoneandisfurtherincreasing.Manycomefromtheeasternpartofthecountrywherecountries likeThailandare incloserproximitythantheBlackSea,GreeceorTurkeywhicharepopularwithMuscovitesforexample.Manyintheeastworkintheenergyandminingindustriesandcanearnagreatdealofmoney.Due to the generally poor level of englishmost are attracted by therussianlanguageinfrastructureofPattayacitywithmenus,signsandinformation in theCyrillic alphabet aswell asrussian speakers, bothnative and thai to assist them.
foREIgN owNERSHIp / domESTIC dEmANd
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PattayaaswellasotherresorttownsinThailandhavebeenhamperedbythestrengthoftheThaiBahtagainstcurrenciesofthevastmajorityof foreign demand. However in the past sixmonths currencies haverecoveredalthoughthefraughtfinancialsituationofmanygovernmentsineuropeaswellastheUSAcanaddmorepressureontheeuroanddollarinthefuture.TheAustraliandollarhasbuckedthetrendwithits
strong commodities sector enhancing thevalue of the currency. ThisgoessomewaytoexplainingwhymoreAustraliansarebuyingresortpropertythroughoutThailand,includingPattaya,aswellastheprohibitiveprices of coastal real estate in Australia. The average price for anapartmentontheGoldCoastinQ22011is16.5millionbaht.
It is interesting to note that the beginning of significant foreigncondominiumbuyingwhichtookoffin1992wasalsoatimeofaverystrongThai baht againstmanymajor currencies.TheAsianfinancial
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AvERAgE SEllINg pRICE of ToTAl uNITS By loCATIoN, AS of H1 2011
Theaverage selling price inWongamat remains thehighest, althoughthisdroppedfromthesecondhalfof2010byaround17%,duetotheaveragesellingpriceofthenewcondominiumprojectbylPNwhichhasbeenofferedforapproximatelyTHB37,000persqm,astheprojectislocated on Sukhumvit road and is more than one kilometre from the beach.TheaveragesellingpriceinotherlocationsincreasedfromH2
Beachfrontage isthekeydriverfor luxurycondominiums.Pricescanrise by over 100%when located by the beach, especially in Jomtienwhere many projects are located some distance from the shoreline.Thereisalsoapremiumforhighrisecondominiumsastheviewfrom
theunitisespeciallyimportantforbuyersofaresortproperty.InrelationtoBangkokmost Pattaya city developments use greater quantities ofglass in their construction in order to make the most of the surroundings.
pRICE
BEACH fRoNTAgE ANd HEIgHT of CoNdomINIumS AffECT oN pRICE H1 2011
Source: Colliers international thailand research
Source : Colliers international thailand research
loCATIoNAvERAgE SEllINg pRICE
(THB / SQ m.)
AvERAgE SEllINg pRICE (THB / SQ m.)
BEACHfRoNT oTHER AREAHIgH RISE
(> 8 storey)
low RISE
(< 8 storey)
Wongamat 70,000 96,000 50,000 67,000 85,000
Pattaya 68,200 72,500 66,150
Pratumnak 65,000 71,500 65,000
Jomtien 55,150 122,000 48,500 66,750 43,500
na Jomtien 60,400 115,500 36,800 125,000 44,500
PattaYa citY condominium rePort market|H12011(HAlfYeAr)
Manyfactorsarefalling intoplacethatwillcontinuetopropelPattayaforward as an international city rather than simply a resort. GrowingdemandfromforeignersinvibrantvisitormarketssuchasrussiaandIndia-MoreThaisnowpurchasingpropertyasasecondhome-Theincreasing industrialization of Chonburi province and Pattaya as apotentialcommercialhub-futureretailandentertainmentdevelopmentthatwillenhancetheattractivenessofthecity.
In previous reportsColliers Internationalwasbullish about the futureprospects of the city over the course of the next ten years. There isnothingtoalterthisviewpointandinfacteventsinthepastsixmonthsgosomewaytostrengtheningthatpositiveoutlook.
foRECAST
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AppENdIX
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zoNINg
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PattaYa citY condominium rePort market|H12011(HAlfYeAr)
1. woNg AmATThisistheareatothenorthofPattayaNua.Itisconsideredapeaceful,moreup-marketlocationandisarelativelynewareaforcondominiumdevelopment. 2. pATTAyAThisarea isconsideredasthecitycentre.ThesectionofbeachfromCentralroadsouthtotheharbourrunsadjacentthecoreofPattaya’sabundant nightlife area. Many sections of the beach are covered byrenteddeckchairsrunbylocalbeveragevendorsduringdaylighthours.PattayaNuaandKlangaretheareasfavouredbyAsianvisitors,especiallyChineseandKorean,whiletheareaofSouthPattayaispopularamongmiddle eastern, South asian and russian visitors.
3. pRATumNAKThisareacoversthemainthoroughfareconnectingPattayaandJomtienBeach. Many upscale restaurants have recently sprung up alongThappraya road. This area is very popular with Scandinavian andrussianvisitors.PartofPratumnakcontainshillswheremoreexclusivestyleaccommodationcanbefound.
4. jomTIENJomtienbeachisabout1kmsouthofPratumnakHill.Thelocaleishometo many high-rise condominiums, beach front hotels, shops andrestaurants.TheareaatthebeginningofJomtien isconsideredbusy,whilethearealocatedattheendofthisbeachisconsideredpeacefulandtranquilwithlesstrafficpassingthrough.
5. NA jomTIENNaJomtienbeachissouthofJomtienanddoesnothaveabeachfrontroad and is less developed as a result .Themain road connection isSukhumvitroad,whichislocatedbetween500–1,000metersfromthebeach,thisareaextendstoBangSaraybeachinSattahipdistrict. Note: The report covers residential areas located on or west of Sukhumvit road.
