Mitsubishi Estate taps Thai office property market
BANGKOK, NNA - Major Japanese developer Mitsubishi Estate Co. is tapping the office property market in Thailand following a number of housing projects in the country to pursue overseas business expansion.
The company said Tuesday it has teamed up with Raimon Land Public Co., Thailand's prime housing developer, to build the 61-story One City Centre complex, an 8.8 billion baht ($276 million) project in central Bangkok. The construction began in February and is scheduled to end in the fourth quarter of 2022.
Mitsubishi takes a 40 percent stake in the investment for the project and Raimon sponsors 60 percent, they said at a press conference in Bangkok.
The prime grade office architecture with four basement floors has a rental floor space of 61,000 square meters, including a four-story retail building adjacent to the tower, which is directly linked to Phloen Chit Station on Bangkok Skytrain line, also called BTS.
“The Thai office property market is solid and demand is growing, especially for grade A offices which are in short supply,” said Yutaro Yotsuzuka, managing director of Mitsubishi Estate Asia Pte. Ltd. in Singapore.
An area covering the train network's Phloen Chit to Chit Lom stations, where the complex will be located, is among those with the highest space lease demand and the highest average space lease price in Bangkok, said Suphin Mechuchep, managing director of real estate services firm Jones Lang LaSalle (Thailand) Ltd.
The area had a 6.3 percent office vacancy rate in the first quarter of this year, lower than the capital's average of 7.1 percent, she told reporters.
The demand chiefly comes from financing, technology and co-working space firms, she added.
Raimon Land expects to see an occupancy rate of 75 percent in one year after its opening, the company's CEO Lionel Lee said.
The largest Japanese real estate firm by fixed assets, has so far developed four housing projects in the Thai capital with a total of 3,989 units as of March. Another seven such properties with 8,341 units in total in the pipeline in the city for scheduled completion in 2020 and 2021.
In Southeast Asia, the company has embarked on office building projects in Indonesia, Myanmar, Singapore and Vietnam, it said. (NNA/Kyodo)