Office space in Bangkok is getting more expensive as demand from international companies continues to outstrip supply, according to new research from Colliers International in its latest Bangkok Office Market research report.
No new office buildings were added to the market during the first nine months of 2013, however, around 57,400 sqm is predicted to complete in the last quarter of this year.
The Northern Fringe area of the Thai capital is the most popular area for office building development, he reason being that more than 182,000 sqm of space is expected to complete in this location between 2013 and 2014.
Rental and occupancy rates in Q3 2013 slightly increased from the previous quarter.
The total office supply in Bangkok during Q3 2013 was approximately 8,042,000 sqm. In Bangkok, only around 1,103,000 sqm, which is approximately 13.6 percent of the city’s total office supply, was added to the market since 200. However, more than 86.4 percent of this supply was completed before 2003.
One new office building is scheduled to complete in the last quarter of 2013. Some parts of this building were reserved by some future tenants already, and as such the new space is not likely to affect the whole market.
A lot of new office space was occupied during the first half of 2013, and as such the average occupancy rate of the total market significantly increased from the previous year – especially in the central business district area.
The average occupancy rate in the last quarter is likely to slightly increase from this quarter, noted Colliers.
Rental rates also sharply increased in Q1 2013. Furthermore, in some locations, the rental rates of most office buildings are still mildly increasing. As such, the average rate in the last quarter of the year may be similar to that of this quarter or show a marginal increase in some locations.
In Bangkok, some large projects are planned for development in the future in several locations around the city, such as Ladprao intersection, the area close to BTS Mo Chit Station, Suan Lum, Makkasan Complex and Rama 4 – Ratchadapoisek intersection. All these projects comprise residential, retail and office space. Some of these projects could change the surrounding area and will probably create a new business centre in Bangkok.
The area starting from Rama 9 junction and running along Ratchadapisek Road, is becoming the Bangkok’s new business Zone. Most new office buildings that are expected to complete in 2015 are located in this area. In addition, a large land plot is available in the area, and its landlord plans to develop some office buildings on it in the future.
Full report: http://www.colliers.co.th/images/agency/KGtQnctEOfficeQ32013-en.pdf
Andrew Batt, International Group Editor of PropertyGuru Group, wrote this story. To contact him about this or other stories email andrew@propertyguru.com.sg
Recent stories you may have missed:
Big win for Koh Samui’s Samujana at Southeast Asia Property Awards
Thailand comes top for ‘expat experience’ in global survey
Phuket property in the spotlight
Bangkok sees strong demand from Singapore property buyers
Drop in new property launches in Bangkok