The State of Capital Markets in Thailand

Mr.Maarten Prins, Director, Capital Markets & Investment, said 2020 was predominantly a wait-and-see year. In the first few months of the year most market parties expected the COVID-19 pandemic to be over soon and there were few pricing adjustments in ongoing hotel deals. As more businesses were forced to close and lay off staff during the latter part of the year, many investors expected substantial discounts on hotel assets. The comprehensive support measures that were implemented by the Bank of Thailand largely managed to avoid distress and hotel owners were not under pressure to sell their properties at deep discounts. As a consequence, few transactions materialized. 

We have witnessed a strong start to 2021. More commercial assets, especially hotels, are available at reasonable prices and there has been a noticeable increase in buyers who are ready to deploy capital. Whilst the amount of distressed deals remains minimal, there are certainly attractive opportunities available to savvy investors with realistic pricing expectations.

We are also seeing more demand for project funding as commercial banks have become more reluctant to lend on new developments in certain real estate sectors or demand a higher equity stake from developers. Private lenders are stepping in to fill this funding gap and are willing to provide typically short-term loans at higher interest rates.

In addition, we also continue to see Thai investor demand for overseas commercial properties as the Thai baht remains strong. As part of the dedicated global Knight Frank investment network of over 1,100 advisors across 57 countries, we provide unrivalled insight and access to global capital markets to our clientele and can assist throughout the entire acquisition process. With close to 25 years of local expertise, We also provide market-leading advice and support on all aspects of property – both commercial and residential – to investors and companies for their personal or business needs.

Knight Frank Thailand’s capital markets & investment team handles commercial real estate transactions including hotel and office acquisitions and sales, land sales and co-investments and joint ventures.Advertisement

We possess a thorough, in-depth understanding of the local real estate market as well as unparalleled access to the key players, helping us to successfully introduce suitable domestic and international investment partners, identify sites with development potential and offer advice on acquisitions and disposals of land and buildings. In addition, we are able to offer up-to-date market intelligence throughout the world and deliver fast and efficient access to investment products and bespoke market research. This enables us to provide in-depth advice to our clients on where to invest their capital and access to the best assets to maximise their returns and preserve their wealth.

He added, with vaccines on the horizon the prospects of a return to some sort of ‘old normal’ by the end of 2021 seem more likely by the day. Whilst some property market challenges are likely to persist for a few more years, there is a current window of opportunity for investors and private lenders that may not be there for long. As such, now would be a great time to invest.

At present we are working on a number of hotel transactions and have over 30 great hotels for sale. These range from high-end hotels in Central Bangkok to beachfront resorts in the key tourist destinations. We have also been mandated to find co-investment partners or raise capital for a number of commercial projects. For any of these opportunities we welcome investor inquiries!  

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