Sansiri believes it can attract Japanese investors to its projects in Bangkok as they search for higher-yielding assets like property that are currently unavailable in their own country, Bloomberg reported. The developer already has plans in place to promote projects to Japanese buyers and is targeting significant growth from this group of investors.
Demand for condominiums in Thailand remains strong even as external factors such as slowing growth in China harm other sectors of the economy, Sansiri’s senior executive vice president Uthai Uthaisangsuk told Bloomberg. He added that the company plans to increase sales in Japan this year by USD8 million to USD10 million. The developer brought in USD2 million in 2015. If Sansiri were to reach its estimate, it would account for almost seven percent of its overseas sales revenue.
“I think Japanese love to have yield,” Uthai explained. “Thai property offers the chance to appreciate, and while you’re waiting for the appreciation, you’ve got the yield.”
Japanese investors have been forced to look abroad in order to find strong yields. Bloomberg reported that yields on about 70 percent of government bonds are below zero as the country’s central bank decided to adapt a negative interest-rate policy which is greatly impacted yields.
Meanwhile Thailand’s GDP grew by 2.8 percent during the fourth quarter of 2015 beating the consensus of analysts surveyed by Bloomberg. This in turn has helped push up condominium prices with units in the high-end segment of the market continuing to perform the strongest.
Uthaisangsuk was reported by Bloomberg as saying property investments in Thailand yield between five percent and eight percent. The price for a unit at Sansiri’s latest development starts at USD174,000. The project is situated near Bangkok’s business district and has earned positive reviews so far. “Japan has negative interest rates and people keep their money as cash,” Uthai concluded. “Why not invest in Thailand?”
