Some developers are worried about the relaxation of foreign ownership rules in Thailand’s Eastern Economic Corridor (EEC). The new EEC Act, drafted last month, allows foreign businesses to take advantage of loosened regulations on land ownership in certain areas of the 13,285 square kilometre economic zone, which covers the provinces of Chonburi, Rayong, and Chachoengsao.
The new rules allow foreign companies to lease land for up to 50 years for residential development and up to 99 years for commercial and industrial areas. There are also projects being promoted by the Thailand Board of Investment (BOI) that will be exempt from foreign land ownership restrictions currently in place.
There is some concern among those in the property industry that the government may offer 100 per cent ownership to non-Thai land seekers, something developers see as being bad for the country. Some suggest limiting the size of land plots where full foreign ownership is allowed if the plot is going to be used for a condo project.
“If the land size for condominium buildings in the EEC is not limited, a plot sized up to 1,000 rai could be developed for a condominium project with only 10 units,” says Issara Boonyoung, honorary president of the Housing Business Association.
It was suggested that any parcels designated for condo projects with full foreign ownership should be restricted to plots between 2 and 5 rai in order to prevent excess land being used. Experts recommend the Thai government discuss EEC plans with real estate stakeholders in order to prevent issues from harming the project.
“To maximise the potential, the relevant government agencies should synergise with neighbouring areas or existing industrial and commercial hubs,” says Suphin Mechuchep, Managing Director of Jones Lang LaSalle Thailand and Chair of the Judging Panel at the Thailand Property Awards.
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