Friday, March 28, 2008

Serviced Apartment sector BOOMS



Competition will increase with the number of units set to rise to 6,580 by 2011, stoking fears of oversupply

Central Lumpini is considered a prime location for serviced apartments, Grade A as well as Grade B. The price for Grade-A apartments is about Bt1,222 per square metre while Grade-B apartments are available for about Bt1,100 per sqm, according to research by Colliers International (Thailand).

Central Lumpini runs along Rama I, Rajdamri, Wireless, Ploenchit and Langsuan roads and serviced- apartment projects include Cape House, Centre PointWireless and Natural Ville.

These projects comprise 1,984 units.

Another 578 units will be added in the year 2011, the research said. These will be in the Bliss Residence at Soi Ruamrudee, the Baan Rajprasong at Soi Mahadlekluang 3, the Noble Ambience Ruamrudee at Soi Ruamrudee 2, the Siam Kmpinski at Rama I, at St Regis at Rajdamri Road, and two new projects on Ploenchit Road.

Colliers’ managing director Patima Jeerapaet said Central Lumpini was experiencing strong demand because the area is conveniently located for business travellers and tourists.

Meanwhile, Grade- A serviced apartments in the central business district (CBD), which stretches from Silom Road and Sathorn Road as well as other sois in between, ranks second in terms of offer price at Bt1,210 per sqm.

This is followed by the Sukhumvit area, where prices stand at Bt1,093 per sqm.

For Grade- B serviced apartments, prices in the Sukhumvit area are at Bt1,057 per sqm, followed by the CBD where prices stand at Bt738 per sqm.

Patima said demand for GradeA and B serviced apartments arose from the growing number of expatriates.

However, he said, nearly 6,580 new serviced apartments, which will be launched from next year until 2011, would stoke further competition in the market.

“Developers planning to build new serviced apartments this year will have to consider that there might be a oversupply situation by 2011,” he said.

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