By Andrew Batt:
The Bangkok office sector is becoming a landlords’ market for the first time in 20 years, according to predictions from property consultancy CBRE.
There is currently more than 8 million sq ft of office space in Bangkok compared to less than 1 million sq ft just 25 years ago. Bangkok boasts 25 percent more office space than Singapore, and is home to some of the best commercial buildings anywhere in the world.
Many new buildings have been designed around the needs of tenants and offer features including flexible floor plates and high-speed zoned lifts. The growing eco-trend has also been reflected in the increasing number of LEED certified buildings with energy-saving features.
CBRE observed that the Bangkok office market is moving into a period of robust health, and for the first time in 20 years the market is becoming a landlords’ market. Take-up has also exceeded 100,000 sq.m. per annum for the first time in five years, with further growth expected.
The record price for office rent in Bangkok currently stands at THB980 per sqm per month. This record is held by the Park Ventures building on Wireless Road, and rents here are even higher than the previous peak in 1992-1993 which saw prices of THB820 per sqm per month achieved at Diethelm Towers – also on Wireless Road.
Office rents in Thai baht terms will continue to appreciate, said CBRE, but they still offer extremely good value regionally. The property consultancy also said that, in many respects, Bangkok is a natural regional base. This is especially evident with the opening up of Myanmar.
If a regional office package incorporating work permits and visas, the transfer of technology and tax benefits was improved by the Thai government to attract companies such as in Hong Kong and Singapore, the service sector could grow significantly. Bangkok can offer regional companies a base for their operators at a third of the cost of Singapore, it said.
The footprint of the Bangkok office market is also evolving. It is no longer just one central business district market; a number of viable secondary business districts have emerged with the extensions tp mass transit connections and retail in the North of Bangkok.
The Ratchada area is becoming the predominant choice for office locations compared to Vibhavadee which was once a popular area in the past before the mass transit system was completed.
Andrew Batt, International Group Editor of PropertyGuru, wrote this story. To contact him about this or other stories email andrew@allproperty.com.sg
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