ASEAN KEY DESTINATIONS
Asean integration to 'bring many benefits' to Thailand
The gains will come through foreign investors expanding their investments in Asean countries. They will need office space, service apartments and residences to support their business expansion, Real Estate Information Centre director-general Samma Kitsin said.
"After the AEC becomes effective, most of the multinational firms will move their top management and operation staff to this region. Most of them will need space for work and living. This will provide opportunities for property firms who develop office and condominium projects," Samma said.
Meanwhile, Thailand's property developers could face labour shortage if foreign labour from Cambodia, Myanmar and Laos move out from Thailand to their own countries, he said.
At present, Thailand's property and construction business faces labour shortage amid rising demand for residential and infrastructure projects since 2010.
Meanwhile, Thailand's property developers are also interested in expanding their investment in AEC countries. For example, Pruksa Real Estate has expanded its investment by 3 billion baht (US$97 million) in Vietnam since 2010 to develop residential projects. The company also is studying possibilities of investing in Indonesia and the Philippines.
Southern property firm DRS Property Co plans to develop a condominium and community mall worth 2 billion baht in Malaysia in the middle of next year. That will be complete in 2015, the year the AEC comes into effect.
The company's CEO, Ibrorheng Cheali, said that the company is interested in expanding its investment in Malaysia because it would be a challenge for the company in an AEC country, especially Malaysia, where the company has relationship with local investors.
Meanwhile, according to Bloomberg, Deutsche Bank AG (DBK)'s RREEF unit said that Bangkok, Jakarta and Kuala Lumpur are attractive for investors seeking to boost returns by holding riskier assets.
Leslie Chua, the head of research and strategy in the Asia-Pacific region at RREEF Real Estate, a unit of Deutsche Asset Management (Asia) said that retail real estate such as supermarkets, convenience stores, and logistics facilities, which include warehouses that focus on e-commerce, offer opportunities.
RREEF recommends investors diversify by boosting alternative investments, including Asian real estate, to counter declines in traditional assets, such as bonds and stocks. A growing middle class and changing lifestyles in Southeast Asia is attracting retailers as Europe's sovereign debt crisis and a global economic slowdown curb spending elsewhere.
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