Red light still on in property development in Burma

 "You could say that the situation for investors is a bit like amber at a traffic light with everybody ready to go after the sanctions are lifted and a new investment law passed", said Patima Jeerapaet, managing director of Colliers. Land prices in prime locations such as Pyay road and downtown attaining the same levels as that of the centre of Bangkok in anticipation of an opening up in the near term.
 "There is some caution within the optimism, though," he said.
 He cautioned that the country once opened its door, just to close it later. This time, he believed that as the country slipped to bottom of the ASEAN economic league table, below that of Laos and Cambodia, Burma would see the need for a reform.
 Tony Picon, associate director of research at Colliers, the history of the country over the past twenty years has significantly altered the way investors should think about real estate in Yangon, often known as Rangoon and is the commercial centre of the country.
 "One example is that the most sought after and expensive units of an apartment or condominium are on the ground floor, which is totally opposite from other countries and for good reason", he remarked. In fact the definition of what differentiates an apartment from a condominium is also unusual. "In Burma, a condominium has a lift whereas an apartment doesn't, as there is no law defining actual strata title," added Picon. 
 The office market is in high demand with total supply limited to around 50,000 square metres, less than many individual office buildings in Bangkok. According to Surachet Kongcheep, senior manger of research at Colliers, occupancy is at 100 per cent in all but one of the buildings. "There was no new supply for the whole of the last decade and one new office building opened in 2010", explained Surachet. "Many businesses and NGOs occupy space in residential units and some have taken up space in hotels and serviced apartments."
 Both the hotel and serviced apartment market are now seeing very robust demand mostly on the back of a surge in growth from tourists following the release of Suu Kyi and renewed interest of businesspeople in the country.
  Picon pointed out that hotels have to turn people away due to increased demand and so little supply. "It wasn't long ago when they remained largely empty and having their rooms converted to office space was the only means of surviving such difficult times", he claimed. Many in the tourist  industry are concerned that such limited supply will create bottle necks in the future for the whole of Burma as Yangon is the main entry point and tourists will wish stay for a few days  and visit the many sights in the city before travelling elsewhere.
 The next year will be a critical one for the country as it is expected to pass an investment law that could lead to a pro-development growth model based on export led manufacturing. "That is the only way that sustainable growth for the country can occur as has happened in Vietnam, Cambodia and Laos in the past ten years or so", said Picon. Gestures of reconciliation between the government and opposition could become more tangible and eventually lead to an ending of sanctions. New finance regulations are planned that will bring the official rate of the Kyat currency in line with the market rate and allow smoother operations in what is essentially a cash based economy. Picon sees the currency, investment law and sanctions as the three pillars keeping the traffic light on amber. "Once these three are dealt with the green light will appear but although like any emerging economy the road will be difficult with many obstacles, the country will soar and the Yangon Property Report for 2021 will be a very different one from 2011, we hope".