Surge in demand sparks price war among Bangkok office buildings

TUESDAY, JULY 09, 2024

Buildings bring down rents as One Bangkok mega project set to open before yearend

As more multinationals open their branches in Thailand, office buildings in downtown Bangkok have begun employing price strategies to attract new tenants, real-estate consultants, Knight Frank Thailand, said on Monday. 

Competition is especially strong in the Rama IV area, where the One Bangkok mega project is poised to fully open later this year, said Panya Jenkitvathanalert, head of Knight Frank Thailand’s Office Agency. 

A joint venture between TCC Assets and Frasers Property Holdings, the 120-billion-baht mixed-use project is set to add 500,000 square metres of new office space on the already bustling Rama IV Road. 

Both new and existing office buildings in this area are slashing their prices to encourage new tenants to sign contracts and old ones to extend their contracts before One Bangkok opens fully by yearend, he said.

Surge in demand sparks price war among Bangkok office buildings

Panya added that One Bangkok would likely dominate the office rental market in this zone as it focuses on sustainability, a trend highly sought after by most multinational corporations.

“These companies are also looking for office spaces that meet international standards, are convenient, safe, with modern technology, and promote good health and well-being of tenants,” he said.

One Bangkok opened its Tower 4 office building in March, and about 80% of it has been snapped up, he added.

However, Panya said, with more choices available to customers, even brand new buildings are bowing to the pressure. 

For instance, rents at One City Centre on Ploenchit Road average out at 1,500 baht per square metre, and it is now 70% occupied.

This Raimon Land Plc project is Thailand’s tallest office building at 275.76 metres, and mainly targets transnational companies, global banks, IT and tourism operators.

Surge in demand sparks price war among Bangkok office buildings

Central Pattana Plc, meanwhile, is getting ready to open its 11th office building, Central Park Offices, at the Dusit Central Park mixed-use project in the second quarter of next year.

The 46-billion-baht 43-floor project will feature 60,000sqm of office space for rent at 1,400-1,500 baht per square metre.

The developer reckons up to 40% of the offices will be reserved by the end of this year.