Frasers to tap buying power of upper class with single-detached homes

The developer sees potential for strong growth in the single-detached houses market in Bangkok and surrounding areas, as the upper-class market is unaffected by the economic slowdown.

Currently, single-family homes account for 30-40% of its portfolio.

Acting CEO Somboon Wasinchutchawal explained that luxury single homes worth more than 10 million baht are still in demand from the upper class, which has the purchasing power.

In comparison to the townhomes and condominium markets, he noted that demand is already returning, but the power to buy from its target group remains low because they must first clear their debts incurred during the Covid-19 pandemic.

Also, the debt burden, combined with high inflation and interest rates, have made banks tighten their lending criteria, making it more difficult to lend.

As a result, single-detached homes are going to be on Frasers Property Home (Thailand)'s radar for years to come.

Somboon, however, clarified that its former main product, townhomes, were not going to be ignored.

He said the company would continue to develop such projects when purchasing power returns.
He expected the purchasing power in the townhome market to recover in 2025.

"The company will continue its growth strategy by increasing single-detached house products to 50% of the overall portfolio while continually expanding the twin home, townhome, and condominium portfolio," he said.

To maintain its position as one of the leading residential real estate developer across various segments, Somboon said Fraser Property Home (Thailand) must expand its product portfolio to meet the demands of all markets.

The company recently announced the official launch of its first condominium project in Ratchada, one of Bangkok's main commercial areas.

He noted that the project is aimed at actual residents, not investors.

Pawarun Udomsiri, senior executive vice president for housing project development, added that the company was also looking to develop housing projects in other major cities outside Bangkok.

Those housing projects in rural areas will account for approximately 10% of the total company's portfolio.

Meanwhile, in order to differentiate the company from its competitors, Pawarun said Frasers is currently working on improving its construction process to reduce costs, be environmentally friendly, and meet the needs of customers.

Apichart Hengwanich, senior executive vice president condominium and operation support, noted that the three key strengths of Frasers' condominium projects were location, innovation, and facility.

This means the condo will be close to a Skytrain or subway station, as well as a community mall that residents can reach by walking. Besides, the condominium will be fully equipped with technology to support the modern lifestyle and will include all necessary amenities to promote wellness.

High inflation and interest rates remain the company's main challenges, according to Somboon.

It is the company's responsibility to manage its costs in order to provide different prices while maintaining quality and meeting sustainability trends, he added.

In 2024, he said the company intends to launch new projects in both Bangkok and upcountry. The Grand, Grandio, Prestige, and NEO Home projects are intended to provide environmentally friendly homes through innovative design and construction practises.
 

These eco-friendly initiatives include the use of clean and sustainable energy, the installation of EV chargers, and the incorporation of solar roofs. Solar roofs will be installed in the clubhouses of 71 of the company's projects in 2024, generating 1,470 kilowatts of power, the equivalent of planting 100,000 trees.

"Next year, we plan to refresh our brand to better align with Frasers Property Thailand, to enhance brand awareness and leave a lasting impression on our customers. Our goal is to secure a position among the top five real estate developers in terms of brand recognition in Thailand by 2025," he said.

Frasers Property Home (Thailand) can surpass its target of 3 billion baht in the fourth quarter of the current fiscal year, which ended in September. More information will be released in November, following the submission of its report to the Stock Exchange of Thailand.

The company is one of three subsidiaries of Frasers Property Industrial (Thailand). It has currently delivered a portfolio of 78 housing projects that cover all market segments under the brands Golden, NEO Home, Grandio, and The Grand, with a project value of over 108.700 billion baht as of June 30.