Mr. Pornchai Lertananchoke, Chief Executive Officer of V Property Development Co.,Ltd., the developer of luxury real estate, such as H Sukhumvit 43 and VTARA36, or "Top of Low Rise Condominium at The Heart of Thong-lor" has provided an interview to “Prachachart” team on real estate market that;
Location for Luxury condominiums are mostly in the central city area such as Ploenchit, Chidlom, Lang Suan , Thonglor and Sukhumvit 39-49. And the condominium price is calculated to increase by 15% per year with average price to be more than 200,000 baht per square meter due to the rising land price and the continuously increase project development cost. The price of other newly-launched residential projects that are extended from inner-city area is also noticeably increasing especially in the such area as Din Deang, Phaholyothin, Phrakanong and Prachacheun wheseas the price of new projects in outer-city area is increased by 8%.
Mr. Pornchai is viewing this issue that regarding the rental yield and capital gain issues, comparing with the V Property’s strategic plan, every investor will have a profitable return from their investment because the condo prices will surely be higher in the future. It also guarantees a rental yield of 10% per annum, which is about 2-3% higher than the current average market rate. Moreover, the listing price of other new condominium projects adjacent to VTARA36 location will be set to be above a range of 200,000-300,000 baht per square meter. Positively, all VTARA36 customers can enjoy an immediate profit or have a relatively high capital gain from this investment.
Mr. Pornchai further commented that in the 1st quarter of 2017, V Property has exceeded its target, by receiving very good response of more than 95% condo booked and announced strategies for earning more shares on luxury condominium market, consisting of 3 strategies as follows.
Strategy 1: Set a revenue target of 5,000 Million Baht and target to be in the stock market not later than year 2019.
Mr. Pornchai revealed that "V Property is strategically focusing on developing high-rise projects in the green line or the Sukhumvit line. The target is to reach revenue at 5,000 million baht before year 2020, with the aim of listing the company in the stock market in 2019 to raise funds to expand its business to support future growth. The company is currently in the process of being prepared to comply with the Securities and Exchange Commission (SEC) rules. I believe that successful of this will strengthen security and reliability for businesses and organizations to be more sustainable. It also opens for the business opportunity of V Property"
Strategy 2: The Challenge of competing with giant luxury class property developers
Mr. Pornchai mentioned the fierce competition in the real estate market that "Even though there are several large developers launching many projects along BTS lines, V Property company is still certain in our standpoint which is offering customers the product at a reasonable price, or called "Good Investment”. I see that the land price in the city, especially Sukhumvit and Thonglor areas will be continuously rising because of the scarcity of supply. As a result, the price of new condominium projects has to be inevitably high."
Mr. Pornchai revealed the property market research reported from the team that the price of luxury-range residential projects in the city center price raised to about 200,000 baht per square meter. If investors want to buy for renting out, the yield will not be more than 3-4%, not yet including the annual juristic person fees which need to be paid. For capital gain, I think that the investors will have to look at long term investment or over 2 years and above to wait for land prices and condo market prices rise before it can be sold profitably. The VTARA36 and two new projects to be launched this year are the answer to this problem".
The CEO of V Property added, "We have a competitive advantage where V Property's location strategy is focused on finding a good location, but the land price must be reasonable. One of our key success factors is that our product is thought-through designed to suit resident’s needs along with providing unprecedented luxury-class facilities at affordable price comparing to items in the same product class. For this reason, all V Property customers have already been beneficial purchasing at a below-market price regardless of owning any V Property projects and whether for long term lease or sale. In addition, V Property has a leading partner to help find appropriate Japanese tenants who are considered to be sought-after good tenants. Beside, V Property will additionally have a Resale team to give support customers in secondary market.
One of our customer service strengths is that we are able to thoroughly respond to our customers’ needs since our customer- care service will be catered to our internal customers (Exclusive Service), not opened to outsiders. This conceptual service design originates from the ideas to have all customers to be VIPs. Thus, we call all of our customers V-VIP or V Property - Very Important Person. "This is one of customer- centric advantages of V Property to compete with other real estate giants"
Strategy 3: Land bank reinforcement plus skilled teamwork
Mr. Pornchai revealed that "The company is planning to land on the two locations, the first top location which claimed to be the last one on the central Sukhumvit area, next to BTS sky train. The location is also in the popular area for Thai and foreigner investors. The second location is a few minutes from the BTS sky train, is also in the popular district for salary man as per concept of the projects in preliminary stage. Both projects are in process of designs; details are not yet to be disclosed"
In this plan, V Property has also drawn professionals in the real estate industry by recruiting the expertise from the giant real estate developers. Most of V Property key staff is interviewed by the CEOs himself. It shows that Mr. Pornchai CEO is also very much attentive in corporate identity and operations management.
The above is the strategic planning of V Property under the leadership of Mr. Pornchai Lertananchoke, who announced to win market share in the luxury condominium industry which is the battle to keep an eye on.Back 31/5/2560