HONG KONG : As property prices in the Chinese territory soar to record highs, Thai property developer Pace Development launched sales of its luxury Bangkok project MahaNakhon to Hong Kong buyers. Sales worth 350 million baht were recorded over three days.
Rebecca Shum, executive director for investment and project marketing of a property consultant, said it was the best time to sell property to Hong Kong buyers as prices there were very high.
"Hong Kong property prices are now at a peak. They have risen about 20% a year and have never dropped. Investors both in Hong Kong and mainland China are looking for properties elsewhere," she said.
Prices for a new unit in Hong Kong are five times higher than those in Bangkok. New condominium units in Hong Kong are about 1.2 million baht per square metre.
The Peak has the highest property prices at 6 million baht per sq m for a new house and 2.5 million baht per sq m for a new luxury condominium unit.
Ms Shum said investors in Hong Kong and mainland China preferred buying property as an investment as the interest rate for deposits was only 2%, which is unattractive to those who refuse to carry cash.
"Bangkok is still a top-two destination for lifestyle in the eyes of investors in Hong Kong. Their interest in luxury Thai property is driven by a lift in optimism about the overall political and economic environment in Thailand," she added.
She said the new government had made significant promises about stimulating economic growth immediately. Major infrastructure projects were finally likely to progress. This would provide long-term support to economic expansion and be reflected in asset price appreciation, particularly for luxury properties.
Sorapoj Techakrasri, chief executive of Pace, said there were many requests from Hong Kong investors after the general election. Even professional investors were early birds as they considered they would get a better price by acting quickly.
The three-day roadshow attracted 130 groups of potential buyers, one-third of whom were investment bankers. HSBC offers loans of up to 70% of the unit price. Half of the buyers asked about loans.
The developer will hold another roadshow in Singapore this weekend. It targets sales of 15-20 units at a value of about 600 million baht from both roadshows.
Mr Sorapoj said smaller units were preferred by investors while larger ones were more suitable for buyers seeking a residence.
The super-luxury MahaNakhon mixed-use project will be worth 19 billion baht and will have 194 condominium units priced between 225,000 baht and 345,000 baht per sq m. The 77-storey building will be the tallest in Bangkok. It will also house a hotel, Bangkok Edition, operated by Ritz-Carlton and will have 27,000 sq m of retail space.
Mr Sorapoj said luxury project units with a hotel brand were easier to resell. Pace has sold 35% of the MahaNakhon units and expects the figure to increase to 40% after the two roadshows. It aims to have sold 45% of the units by the end of the year.