Plus Property discovers noteworthy demand for mid-Sukhumvit area
27 Jun 2019
plus news and update
Plus Property, the full-service professional property and facility management agency, discloses its findings over condominiums in the mid-Sukhumvit area that comprised the Phrom Phong, Thong Lo, Ekkamai, Phra Khanong and On Nut locales which make these locations stand out. Previously, demand was concentrated in the inner Sukhumvit area and in CBD. But with an outward expansion of urbanization towards the mid-Sukhumvit area, new projects were found launching deeper inside alleys that were not too far from BTS stations. The appeal of access to rapid transit and the ease of commuting via thoroughfares make these new condos suitable for real residency. Meanwhile, the rental market was growing well and was attracting both Thais and foreigners because of the approachable prices. In 2018, the Sukhumvit 63-71 areas lead the field in returns with a rental yield as high as 7%. This was followed by the Thong Lo-Phra Khanong and On Nut locales where rental yield was roughly 6%.
Ms. Suwannee Mahanarongchai, Deputy Managing Director, Business Strategies and Asset Management, Plus Property Company Limited, the full-service professional property and facility management agency, revealed that surveying by Plus Property’s research and development division has revealed that condominiums in the mid-Sukhumvit zone (Phrom Phong-Thong Lo-Ekkamai-Phra Khanong-On Nut) were regaining popularity. 19 new projects were launched within this zone in the second half of 2018, contributing 5,796 units to the market. Of the said newly launched units, 47% were from projects with a price range of 250,000 to 400,000 THB/Sq m. whereas 44% were from projects with a price range of 150,000 to 250,000 THB/Sq . 55% of the new units were not in the immediate vicinity of rapid transit stations but they continued to attract demand.
Within the aforementioned mid-Sukhumvit area, the Thong Lo-Phra Khanong zone had the highest amount of High-end projects. This is especially true for areas in the vicinity of Thong Lo and Ekkamai rapid transit stations where new projects have launched every year over the past 3 years. Notably, 2018 was the year with the most new project launches in the said 3 years – 4 projects were launched, contributing 979 units to the market. On average, High-end projects generated faster sales than those in other segments. In 2018, 13 units were sold per project per month, whereas 10 units were sold per project per month in an average of all segments. This fact reflected the healthy demand for high-end to luxury projects within this location. The average price of newly launched condos was 244,000 THB/Sq m. in the second half of 2018. This price was 15%-25% lower than the average price of all projects available in the market, because the newly launched projects were not situated in Soi Thong Lo but were located in nearby alleys. For the rental aspect, the average rental yield in the Thong Lo-Phra Khanong locale stood close to 6%
It should be noted that in 2018, new projects were found to have launched inside Soi Sukhumvit 61. The attraction of Sukumvit 61 is the privacy and commuting convenience it offers for residents; it is not chaotic inside the alley due to the lack of through roads, but residents are able to use the Park Lane community mall as a thoroughfare that connects to Ekkamai. This provides for privacy and makes the alley appropriate for real living.
Another locale, Sukhumvit 63-71, is a location where condos with a price range of 80,000 to 150,000 THB/Sq m. condominiums have seen the best sales. Over the past 3 years, sales rate in this group exceeded the locale’s average rate. This can be attributed to the fact there were no new launches of projects and existing projects were almost completely sold out with 95% of units having been sold on average; only 10 units were on sale in the second half of 2018. All projects within this group were low-rise projects. In 2018, newly launched condominiums in this group had an average price of 128,000 THB/Sq m. Rental yield, on average, was close to 7% for this locality. Projects launched in 2019 were price between 80,000 and 150,000 THB/Sq m. that were not in the immediate vicinity of BTS stations but which had the appeal of privacy. The Sukhumvit 71 locale especially stands out with as it features thoroughfares that provided direct access to Thong Lo and Ekkamai.
Another attractive locality with projects slated to launch this year is the On Nut locale. It is considered to be within easy reach of Thong Lo and Ekkamai, as well as the Bangkok Mall that is currently under construction on Bang Na intersection and is due for completion in 2020. The current neighborhood already offers a full range of malls and hangout spots that respond to all living demands, even though prices of condominiums in On Nut were still not expensive when compared to those in Thong Lo or Phra Khanong. On Nut BTS station is also just a few stop away from Thong Lo and Phra Khanong stations. The aforementioned appeals, as well as the relatively manageable distances from central business district and affordable rent, have resulted in On Nut having attracted the attention of foreign tenants. There were not many new project launches in the vicinity of On Nut BTS station over the past 3 years. In the second half of 2018, only 48 units remained available in condos with a price rage of 80,000 to 150,000 THB/Sq m. – these were units at low-rise projects that offered privacy and manageable prices. A sales ratio of 92% provides testimony to the high demand for these projects.
“The mid-Sukhumvit locale currently has great momentum and is no less interesting than the inner Sukhumvit area. Urbanisation and the availability of amenities have been rapidly expanding outwards, causing demand to become more dissipated. [The condos here] will provide solutions to those buying the units for self residency as well as those who are buying for investment, with a yield between 6-7%. There is also a variety of project types to choose from, especially for projects that are situated further inside the alley but still offered convenient access to the rapid transit station. With approachable starting prices, these make for another interest option”, said Ms. Suwannee.
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