• 
• 

Published on April 23, 2008

Ki Nan Tsui

The Nation

Like MNIT, the Bt1.075-billion Multi-National Residence Fund will invest in properties with a large expatriate presence, said Pichit Akrathit, president of MFC Asset Management. MNIT's success can be attributed to the generally higher purchasing power of expatriate tenants, mostly executives of multinational companies, said Pichit.

With the economy back on its feet, despite what seems to be another bout of political power struggles, foreign white-collar workers are coming back. It will be the first time that MFC has ventured into the Eastern Seaboard industrial area, serving the housing needs of the large expatriate community, mostly US, Western European and Japanese petrochemical and automotive executives, said Natree Panassutrakorn, MFC's senior property fund manager.

Thailand continues to be a top-three property hotspot for foreign investors, particularly in office buildings where rents are low, said Natree.

Although there are two or three property funds worth about Bt4 billion, focused on office buildings, distribution centres and serviced apartments, MFC chose to go ahead with residential properties first for lower-cost and maintenance reasons, said Natree. In addition to two properties - one housing complex and another set of apartments in the Chaeng Wattana area - the fund will also invest in 35 houses in Chon Buri. The three freehold properties have a total average valuation of Bt1.2 billion, and are expected to appreciate at a rate of 3 per cent per year, said Natree.

"Freehold means investors can take advantage of land and property appreciation," said Natree.

The fund promises a 7.5-per-cent return for the first year, with an annual increase of 0.1 per cent for the subsequent six years. Natree said that Nichada Thani had to make a nine-month deposit in advance as a guarantee of rental fees. MNFC's 10-year-old Danicha Garden apartment complex, although slightly old, has a consistent 100-per-cent occupancy rate.

There are troughs though since expat properties are seasonal. Summers can be especially tough.

The initial public offering period for MNFC runs until May 8.