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Published on December 21, 2007

Sukhumvit Soi 24, which is a few hundred metres long and links Sukhumvit and Rama IV roads, has become another of Bangkok's high-competition areas, with entertainment places, international schools, shopping complexes, a public park and much more.

Prominent along the area's skyline are luxury residential buildings, and the constant emergence of new residential projects shows that demand for the area is on the rise, while rental fees are fiercely competitive.

The local standard appears to be serviced apartments offering luxury residential units with furniture provided and full facilities, including cable television, Internet access, swimming pools, spas and 24-hour security.

Targeted as tenants are wealthy Thais, expat workers and retired foreigners who want long-stay residences where they can live with their families and cook their own meals.

A source at President Park Executive Serviced Apartments in Soi 24 says many new luxury residential buildings have joined the local market. In addition to serviced apartments, the area also has regular apartments, hotels and condominiums, which attract investors looking for rental income as a return on investment.

Two new luxury condominiums seem certain to ensure that the rental trend will continue. One of them is owned by a company called Setthiwankankeha. The other, Emporio Place, is owned by Thai-Singaporean joint venture TCC Capital Land.

Emporio Place has three towers, of 42, 36 and 21 storeys. It will feature three types of condominium units: studios, one- to three-bedroom types and duplexes. It will also house the 340-room Northcroft Hotel.

Another major player in the area is Hope Land Executive Serviced Apartments, owned by Hope Land, an associate of Nirun Housing, which is owned by the Panyaskulwong family.

Hope Land has 187 rooms, including 40-45-square-metre "privacy' apartments, 50-60-square-metre "harmony" units and 85-112-square-metre "luxury" apartments.

Sales manager Patcharee Tippawan says the company targets mainly local customers with high purchasing power and foreigners. Therefore, marketing roadshows and property agencies with worldwide networks are employed to maintain occupancy.

She says serviced apartments constantly focus on providing impressive service to maintain good relations with current customers while at the same time attracting new ones. They are also engaged in a fierce price war to attract new customers and hold onto existing tenants.

The source at President Park Executive Serviced Apartments points out that competitive prices attract both high-ranking executives and corporate customers with long-term rental needs of one or two years.

President Park is owned by the Plapongpanich family's President Park Group. It has 228 rooms offering one-to-two year leases, one-to-three-month renting and also a day rate.

Not far away is Oakwood Residence, owned by Boutique and managed by Oakwood Asia Pacific. It features an eight-storey building with 112 units. Although construction began in 2004, the building opened for residents this month.

The Sukhumvit area, including Soi 24, has long been recognised as a "dollar zone" by foreigners and is a prime area for luxury residences. Major customers are European, American, Indian and Japanese.

However, investors in new developments in the area may soon encounter higher risks, because of the large number of competitors.

Many new investors are turning to new areas. Sathorn Road has already become the second most popular area for luxury residences, and the riverside is the third most popular area despite its distance from mass-transit services. Bang Na district and Srinakarin Road are the fourth most popular areas, followed by northern Bangkok, near international schools.

The accumulated occupancy rate for all of Bangkok's serviced apartments is currently 80 per cent.

Patcharee says among the regular clients who have opted for serviced apartments rather than hotels are international television-commercial and film crews, who also have a liking for the Sukhumvit area.

Some hotels in the area also offer some of their rooms as serviced apartments for periods of up to four months.

While the companies that develop serviced apartments are the major players in the market at present, their dominant role seems likely to be taken over in the future by serviced-apartment agents. The winners may be their customers, who will be able to negotiate for rental and leasing conditions over a much wider range of alternative accommodations.

Property reporters

 The Nation