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Published on August 17, 2007

Cinema entrepreneur Wichai Poolworaluk has diversified his business interests and become a property developer, following the takeover of his EGV Entertainment business by cinema giant Major Cineplex.

"Woraluk Property will be our new business arm after EGV Entertainment merged with Major Cineplex two years ago, and we believe that we will be leading the property market within five years because we have a land bank. That means we have lower costs than our competitors and can offer quality products at more reasonable prices," Wichai says.

Wichai remains a director of Major Cineplex, but says he has more time now to create his new business, and that involves developing his family's land according to strong market demand.

The Poolworaluk family is one of Bangkok's oldest theatre-business families. Wichai's father, Charoen Poolworaluk, owns as many as 10 traditional theatres in Bangkok that were forced to close by the introduction of digital systems and theatre complexes.

Following in his family's footsteps, Wichai began his business by setting up a joint venture in 1994 with the Hong Kong-based Golden Harvest Group and an Australian firm, Village Roadshow. Its name was Entertainment Golden Village International, or EGV, and had registered capital of Bt200 million.

EGV was the first firm to build a multiplex theatre system in Thailand. It cost Bt1.2 billion.

Wichai succeeded in building up EGV to become Thailand's leading theatre firm. It had 20,000 seats in Bangkok in 2000. Then the great tussle between EGV and Major Cineplex, owned by his relative, Vicha Poolworaluk, began. Major Cineplex expanded into EGV's market in 1997 and succeeded in grabbing a 44-per-cent share to become market leader. EGV's market share tumbled from 70 per cent to 34 per cent in 2002.

To overcome EGV's market share loss, Wichai decided to buy out his foreign partners and tried to expand the business back into leadership. However, in 2005, he sold his major stake in EGV to Major Cineplex and escaped the weight of business pressures.

"This is a win-win situation because the takeover reduces market competition and viewers will get the best service from our business," Wichai says.

Wichai took two years to consider what he should do next. Then, in the first quarter of this year, he created his new property business by changing the name of his family's firm from Chaopraya Theatre to Woraluk Property.

He also increased its registered capital from Bt5 million to Bt100 million, with plans to develop residential projects on the land occupied by his father's old traditional theatres.

Wichai, who is Woraluk Property's president, says the company is wholly owned by himself and his father. Its developments will include residential projects, office buildings and retail properties.

The company's first project is a multi-use complex worth up to Bt4 billion called "The Lelux". It will be built on 1.6 hectares of land at Sukhumvit Soi 69, near the Skytrain's Phra Khanong station. Until now, it has been occupied by the old Holiday and Chaopraya theatres.

Wichai says The Lelux will have four buildings. Two of them will be condominiums and the others will house serviced apartments, a hotel and retail areas.

The company began pre-selling the first of the condominiums, with 286 units priced between Bt2 million and Bt10 million, early this year. It is now 80 per cent booked. Construction will start later this year, with completion in two years.

The company plans to launch the second condominium at The Lelux later this year.

"The real-estate market is still active, even though the economy is limping along, so the family is interested in redeveloping our older theatres into housing, office buildings, hotels and serviced apartments."

Wichai says his family has enough land in Bangkok and upcountry to develop more projects according to market demand. As a result he believes Woraluk Property can become the market leader in this sector within five years.

"Although I lack experience in the property market, I have a good ally in the brokerage and property agency Harrison, to provide advice to my company and to manage my projects," Wichai says.

He says his business views have changed because of lessons learnt in his theatre business. He now believes that when expanding into a new area, a company has to find a strategic partner with more experience in that field, to help the new business compete.

Somluck Srimalee

The Nation