Fresh capital of ¤100 million (Bt4.8 billion) from a global property fund is to be invested in the property business around Bangkok's new Suvarnabhumi Airport.

The TMW Asia Property Fund I is planning its first foray into Thai real estate and last month formed a joint venture with a local company, Ananda Development Co Ltd, to set up Ananda One Co Ltd.

The American fund holds a 49-per-cent stake and the remainder is held by the Thai company.

The TMW Asia Property Fund I is managed by Pramerica Real Estate Investors, the real estate investment advisory business of Prudential Financial Inc of the United States.

Its investment in Thailand will account for 10 per cent of the US fund's total value of ¤1 billion. Fifty per cent of its value is invested in Japan.

Pramerica Real Estate Investors' chief executive in Europe, Georg Von Werz, said the Thailand investment would be the fund's first in this country.

"Thailand has been of interest to us ever since the inception of our fund, but we've waited to find a partner here to expand our business," he said.

Ananda One plans to invest Bt8 billion in four property projects on 64 hectares of land around Suvarnbhumi International Airport. Half of this will come from the fund's investment and the rest will be borrowed from banks. Pramerica manages property funds worth US$30.6 billion (Bt1.17 trillion) around the world. Of that, $3 billion is invested in Asia. More than 32 per cent of its investment in Asia goes to Singapore. Twenty-two per cent goes to Japan, 21.1 per cent to Hong Kong, 12.6 per cent to South Korea and the remaining 8 per cent to the Philippines, China, Indonesia and Malaysia.

The Thai side of the joint venture - Ananda Development - is owned by the Ruangkritya family, which operates the windmill project on the Bang Na-Trat highway.

The company recorded sales of Bt1.2 billion last year and expects revenue of Bt1 billion this year.

If its first projects in Thailand are successful, the US fund will continue to expand its investments here, said Ananda One chief executive Chanond Ruangkritya.

It will be following in the footsteps of other property firms and funds from Asia, the US and Europe that have expanded their investments in Thailand's property market over the past two or three years, especially those from Singapore and Hong Kong.

Chanond said the US fund, which focuses on investment in Asia, would raise money from Germany.

Ananda One expects an internal return on its investment of at least 15 per cent per year.

It plans to launch the first of its four new property projects in the last quarter of this year and will target the middle market by offering new houses at prices between Bt2 million and Bt5 million.

"We will focus on the residential market and will not expand into other property projects such as retail, offices, hotels or resorts," Chanond said.

The company also plans to create a "land bank" in Bangkok's central business district, with which to launch further residential projects, including condominiums, next year.

With its business expansion, Ananda One expects the value of its sales to reach Bt24 billion within six years, he said.

Somluck Srimalee

The Nation