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Published on November 9, 2007

Sansiri is Thailand's second-ranked property-development firm, but its CEO is far from satisfied with that achievement.

"Our goal is to drive our business to be the market leader," says Apichart Chutrakul. "That will challenge our staff to create new ideas to push the company to be No 1."

It has been a long climb. Apichart's family formed a small property firm, San Samran Holding, in 1984. Since then, it has become Sansiri and climbed into the top five firms in the property industry.

Apichart says his family suggested in 1988 that he resign from his position with Finance One - which was owned by his cousin, Pin Chakkaphak - to manage the family business.

His first residential project was Ban Kaimook, worth Bt250 million and developed on his family's land at Hua Hin.

"I didn't have any business goals, because I was only 28. I thought it was an opportunity for me to create my own business by developing a residential project on my family's land," he recalls.

When the first project received positive feedback from home-buyers, Apichart and his cousin, Srettha Thavisin, who is now Sansiri's president, joined forces to operate the property firm by focusing on premium products, including detached houses, condominiums, townhouses, hotels, resorts and office buildings.

The original small family company was renamed Sansiri in 1994 after a merger with Siripinyo, a property firm owned by the Lamsam family.

Nine years after entering the property business, Sansiri had succeeded by developing residential projects under the Baan Sansiri brand. Then the 1997 financial crisis struck, and Sansiri's total debt soared from Bt2 billion to Bt5.07 billion.

Finance One, which belonged to Apichart's cousin, was shut down in the face of bankruptcy proceedings. Analysts were quick to assume Sansiri would meet the same fate.

Apichart says, however, he decided there and then to negotiate with his creditors, in order to restructure the company's debt.

"I had a background of work for a financial firm. I had a bachelor's degree in finance from the University of Utah and a master's degree in business administration from the University of San Diego. I knew how to deal with the creditors and decided to solve the firm's financial problems immediately," he says.

At the same time, he decided to sell the company's non-core assets and transfer other assets to pay back some debts. He sold a stake in the business to Starwood property in 1999, and that built up sufficient capital to expand the business in 2000, when its debt rehabilitation was complete.

From the economic crisis, Apichart says he learned how to manage risks and cope with a crisis. He set Sansiri on its course to become the leader in the property market.

"When your business faces a crisis, you must determine a solution and be ready to start again, because the business has to continue," he says.

In November 2000, Sansiri was back in the race. After having called a halt in 1997 by suspending the launch of a new residential project, it began again by investing Bt540.5 million in a single-detached housing project called Narasiri Watcharapol.

In a bold step in 2002, Sansiri took over the Sofitel Silom Hotel in Bangkok from Richee Holding Alliance for Bt700 million. Three years later, it sold a major stake in the hotel to a partnership of LaSalle Investment Management and Accor Asia Pacific for Bt1.2 billion. In one deal, Sansiri generated a profit of Bt500 million, or 71 per cent of its 2002 investment budget.

With an aggressive business philosophy of taking over a project, then selling it for high profits, the spectre of the old Finance One returned to haunt Apichart. When he owned Finance One, Apichart's cousin Pin earned the nickname "the Takeover King", but Apichart denies any similarity.

He says Finance One exhibited strong growth before the economic crisis via selling paper shares on the stock market. However, Sansiri had sold only residential projects and stayed in the real-business sector.

"I've not sold paper or built my wealth from the paper. My business is selling real assets. I don't understand why the public questions my business," he says.

From total revenue of less than Bt2 billion in 2000, Sansiri recorded revenue of Bt5.6 billion and a net profit of Bt87.28 million in the first half of this year.

The company has now developed 34 residential projects, including both detached houses and condominiums, worth a total of nearly Bt20 billion. Of Sansiri's subsidiaries, Plus Property has developed 26 residential projects in Bangkok, Prompattana has developed two projects, and Red Lotus has completed three residential projects in Hua Hin.

When Sansiri returned to strong growth after the economic crisis, Apichart's business strategy was one of determination to become the country's leading property firm in terms of sales value, sales volume and brand awareness in the minds of customers.

"My idea is that when home-buyers plan to buy a house, they think of Sansiri. My housing brand has to be the first in home-buyers' minds," he says.

The first step in the final sprint for No 1 is to build the company's presales value from Bt15 billion this year to Bt20 billion in 2008 by launching an average of 10 residential projects, including both condominium and detached housing, worth up to Bt10 billion a year, he says.

"We took 19 years to build Sansiri from a small property firm into one of the top two in the market. The next step is to be No 1. We don't know when that will be, but that is our new business goal," Apichart says.

Somluck Srimalee

 The Nation