As the advance of transit systems gives rise to suburban bed towns in Southeast Asia, real state developers are quickly seizing the opportunity to supply homes to the emerging ranks of residents who commute to city centers.
Near the Chatuchak subway stop about 10km north of central Bangkok, real-estate developer Sansiri is building a large condominium comprising about 800 units. The area has few high-rises and is close to the starting station of the Purple Line urban rail service launched in August.
All of the apartments were sold on the first day they went on sale. Some of the buyers were foreign investors from Hong Kong and elsewhere, but many were Thais who plan to live in the complex.
“There is solid demand among those who expect improved convenience in the future,” says Uthai Uthaisangsuk, a senior executive vice president of Sansiri.
The second-largest property developer in Thailand has formed a joint venture with BTS Group Holdings, an operator of elevated railway services that owns land around the routes. The duo will together invest $2.86 billion by 2020 to construct 25 properties, including projects in Chatuchak.
New commercial establishments are also popping up in greater Bangkok. Retail titan Central Group, for instance, opened the CentralPlaza Westgate in Nonthaburi Province in late August last year.
The commercial facility is one of the biggest in Southeast Asia, with about 500 domestic and foreign brand vendors occupying floor space totaling 500,000 sq. meters.
Property developers in Thailand all expect growth to pick up in the outer-ring area of Bangkok, suburbs outside of the roughly 5km radius from central Bangkok. U.S. real-estate giant CBRE projects that condo supply in Bangkok suburbs will increase 15% this year to a record 61,000 units. By contrast, the supply of new condos is seen decreasing in the central city.
Similar projects are expected in other major Southeast Asian cities where railway systems are under development. Improvements in transit systems are creating suburbs that draw residents from nearby villages and city centers.