Developer Pruksa limits launches to 49 projects as demand dips

President and chief executive officer Thongma Vijitpongpun said yesterday that the company targeted only Bt29 billion in presales and Bt26 billion in revenue this year, up only 16 per cent and 13 per cent respectively over last year.
He said the company posted Bt25 billion in presales and Bt23.2 billion from transferring residential projects to customers last year. This was lower than its earlier business plan to maintain average annual growth of 25 per cent from 2010-2017.
“We need to revise our business plan to match actual customer demand,” he said.
During the flood disaster that hit Bangkok and suburbs late last year, customers delayed their decisions to buy homes. Some of them had to budget for house renovation instead. The 49 projects to be launched this year include 28 townhouse projects, 15 detached-house projects, and four condominiums. The company will also develop two projects overseas, in India and Vietnam.
Thongma said Pruksa would continue to develop low-rise homes to meet strong demand despite the massive floods last year. However, it will shift its focus to locations in the Central Business Districts and nearby areas, such as Pattanakarn and Chaeng Wattana roads and inner Bangkok such as the Sukhumvit area.
“Our projects in eastern Bangkok, such as Rangsit, will continue, as we believe that customers will not relocate, as they realise the flood was an accident mismanaged by the government,” he said.
Thongma said Pruksa would limit its overseas projects to two, in India and Vietnam. It will move out of Maldives after its 180-unit residential project, worth Bt480 million, has been completed and transferred this year. The company faced a business loss in Maldives worth Bt60 million due to foreign-exchange losses.
“We will slow down our overseas business expansion until the second half of this year when our cash flow returns to normal,” he said.
Under its 2012 business plan to launch 49 new residential projects, Pruksa Real Estate will spend about Bt24 billion, of which Bt6 billion will be for purchase of undeveloped land and Bt18 billion for construction. More than half of the investment will come from the company’s internal cash flow and the rest from bank loans. It will also issue a debenture worth Bt5 billion in the first half.