EEC and tourism destinations attract property investment in Thailand

Southeast Asia’s property market is entering a phase in which growth is spreading beyond a handful of economic centres into economic corridors, industrial cities and tourism destinations, according to JLL’s latest research report, Planning for a Multipolar World: Real Estate Strategies Across Southeast Asia in 2026 and Beyond.

In Thailand, the Eastern Economic Corridor (EEC) remains central to investment, while Phuket and Phang Nga are attracting interest in opportunities involving hotels, high-end residential property and wellness.

This shift reflects investors’ growing focus on locations with the foundations for sustained growth, alongside strong demand for space.

These foundations include infrastructure, manufacturing relocation, supply chain connections and purchasing power generated by tourism.

JLL identifies geopolitical changes, supply chain diversification, government-led infrastructure investment, digital transformation and stricter sustainability standards as forces reshaping the region’s property landscape.

The question is therefore broader than when the market might return to growth.

It also concerns where the next phase of expansion might emerge and which asset classes could benefit first.

China+1 investment supports the EEC’s manufacturing upgrade

The EEC and the Eastern Seaboard have particularly clear strategic roles in the transition from industrial estates towards high-value manufacturing ecosystems.

Infrastructure development and efforts to upgrade Thailand’s industrial sector are supporting this change.

Geopolitical uncertainty is prompting some multinational companies to restructure their supply chains through China+1 strategies, reducing their reliance on manufacturing in a single country.

This creates opportunities for Thailand to attract investment in industries with greater added value, particularly electronics, electric vehicles and advanced logistics.

The resulting demand extends beyond industrial land purchases and leases to high-quality warehouses, specialised manufacturing space and industrial estates with comprehensive management systems.

Development is moving from holding land in anticipation of growth towards building ecosystems that connect factories, logistics providers, infrastructure and supporting businesses.

Industrial city development and large projects around U-Tapao Airport could also broaden the range of promising locations and strengthen connections between industrial areas and other economic centres.

The extent to which these opportunities translate into returns, however, depends on investment continuing to materialise, infrastructure readiness, operating costs and the ability to attract target industries to establish long-term operations.

Phuket and Phang Nga attract tourism and wellness investment

Investment is also spreading to destinations with distinctive selling points.

Beyond industrial areas, tourism markets are becoming another important driver of Thai property investment, particularly Phuket, a global resort destination, and Phang Nga, which is attracting attention for its coastal growth potential.

Opportunities extend beyond hotels and resorts to retail, ultra-luxury residential property and projects linked to health and wellbeing.

Wellness is one trend to watch, offering opportunities to build on existing tourism businesses with services for customers with strong purchasing power, including long-stay visitors and people wanting to live in tourism destinations.

For developers, projects that reflect a location’s distinctive character could offer greater competitiveness than similar properties replicated in several markets.

Tourism-related property growth nevertheless requires careful assessment of fluctuations in visitor numbers, development costs, new supply and the purchasing power of different customer groups.

Phuket and Phang Nga offer opportunities, although investment success depends on matching assets to target markets as well as the destinations’ reputations.

Portfolios place greater emphasis on recurring income

Another change in the property industry is the growing emphasis on recurring income assets alongside developments built for sale.

Hotels, office buildings, retail space, warehouses and rental properties can generate sustained cash flow over the long term when their locations and management are suitable.

This approach reflects a market in which investors are paying greater attention to asset quality and the ability to generate actual income, against a backdrop of economic uncertainty and financing costs.

For developers, adjusting portfolios involves more than increasing the number of projects.

It requires selecting assets that balance recurring income, capital appreciation and investment risk.

Recurring income does not guarantee returns, which still depend on leasing performance, operating costs, debt obligations and the ability to retain customers over time.

Operators capable of managing assets throughout their lifecycle, from site selection and development to income generation and long-term value enhancement, may therefore have an advantage.

Sustainability standards put older buildings at risk of losing value

While geopolitical changes and infrastructure development are creating new property locations, environmental, social and governance (ESG) standards are also reshaping the value of existing assets.

Buildings with outdated designs, inefficient energy use or an inability to meet environmental and sustainability standards may be at a disadvantage compared with upgraded properties that meet the requirements of a new generation of tenants.

The difference in value between assets with sustainability limitations and higher-quality properties is commonly described as a “brown discount”.

This pressure can affect rents, tenant appeal and sale values.

Older office buildings and retail properties in Bangkok therefore face an important choice between refurbishment to remain competitive and changes in use to meet market demand.

Opportunities range from upgrading building systems for greater energy efficiency and improving functional standards to redevelopment or conversion into other uses.

These could include housing, hotels, healthcare facilities or mixed-use projects, where regulations and economic feasibility allow.

Refurbishment is not suitable for every building.

Investors need to assess improvement costs, legal constraints, building age, market demand and expected returns before deciding.

Older assets do not necessarily lack further opportunities.

Where owners can identify shortcomings and invest appropriately in improvements, the challenges posed by ESG standards can also provide a route to creating additional value.