Frasers focuses on stable 2021 revenue

Frasers focuses on stable 2021 revenue

Property firm targets B20bn this year, next

Thanapol: Low-rise beats condo market
Thanapol: Low-rise beats condo market

Due to the sluggish economy and property sector, SET-listed Frasers Property Thailand (FPT), owned by the Sirivadhanabhakdi family, is aiming to maintain 2021 revenue of 20 billion baht, focusing on residential, industrial and office development.

Thanapol Sirithanachai, country chief executive, said the impact of the coronavirus crisis on the global economy, the depressed domestic economic outlook, political instability and prolonged trade wars will continue to challenge the property sector next year.

"In such difficulties, we will keep monitoring the situation, as there are new factors springing up all the time," he said. "We will try to sustain our growth with an aim to have revenue next year at the same level as 2020."

FPT recorded 14-15 billion baht in revenue during the first nine months of 2020 and expects to have 20 billion baht by the end of the year.

Some 70-80% was from residential development, after FPT acquired low-rise residential developer Golden Land Property Development Plc in August.

The rest was from recurring assets such as industrial estates, office space and hotels.

From next year, FPT will spend a total of 10 billion baht a year, comprising 6-8 billion baht for land acquisition to develop residential projects under Frasers Property Home Group.

A further 2 billion baht will be allocated to construction of warehouses and factories under Frasers Property Industrial Group, including ready-built and built-to-suit properties in more than 50 locations in Bangkok and nationwide.

"We will focus on low-rise housing development because demand in this segment is strong and continues to be robust while the condo market has been sluggish," Mr Thanapol said.

Although the industrial property outlook has some factory owners struggling, demand for warehouses and distribution centres is rising, driven by the coronavirus pandemic's attack on the logistics system.

"We have got many requests from several companies that had logistics problems resulting from the virus," Mr Thanapol said. "They needed to pile up their stock and an expanded domestic distribution centre."

Low-rise residential developer Golden Land was acquired by FPT in August.

He said FPT is looking at acquisition opportunities for office towers if there are any landlords facing difficulty amid Covid-19.

But no new greenfield development of office space is planned for the next few years, as the company's parent firm, Frasers Property Ltd, is busy with One Bangkok, a flagship project with investment exceeding 120 billion baht.

If TCC Group, a conglomerate owned by billionaire Charoen Sirivadhanabhakdi, wants to divest of or sell properties or land plots, FPT's focus will only be on those feasible for industrial, residential and office development, Mr Thanapol said.

Besides TCC Group, which holds properties and land plots nationwide, the family's property business includes SET-listed Asset World Corp Plc (AWC), which focuses on hospitality and tourism-related retail spaces, as well as office buildings.

"As a fully integrated property firm, FPT's investment over the next three years aims to boost total assets by 15% from the current 100 billion baht," Mr Thanapol said.

As of Sept 30, FPT had 59 active residential projects in Bangkok, Chon Buri, Chachoengsao, Ayutthaya, Nakhon Ratchasima, Chiang Rai and Chiang Rai. The projects had a combined value of 70 billion baht

FPT also has 3 million square metres of industrial properties under management and 240,000 sq m of office space.

Other businesses include data centre operator ST Telemedia Global Data Centres Thailand, a joint venture with Singapore-based ST Telemedia Global Data Centres; co-working space operator JustCo; and a 51.3-billion-baht real estate investment trust.

Do you like the content of this article?
COMMENT