Cp land joins Magnolias in residential jv

CP Land, the property arm of Charoen Pokphand Group, has set up a joint venture with Magnolias Quality Development Corp (MQDC) to expand residential projects nationwide.

The joint venture, CP Magnolias Corp (CPMQ), has registered capital of Bt150 million, held equally by CP Land and MQDC.

The company plans to increase its registered capital to nearly Bt300 million after launching its Bt2-billion Chur Pattaya residential project yesterday, said CPMQ director and CP Land executive vice president Somkiat Ruentongdee.

CPMQ has invested Bt1.1 billion for the construction of the South Pattaya project. Up to 70 per cent will be borrowed from banks and the rest will come from the company's capital.

Somkiat said the Chur Pattaya would be its first residential project. The company plans to launch two or three others in the second half.

CPMQ expects sales for the Chur Pattaya to reach nearly half of the total project value of Bt2 billion by the end of the year. Presales open on June 28 at a starting price of Bt47,000 per square metre, and the remaining half will sold out in the next year, he added.

"CPMQ will be a part of CP Land's business expansion this year and next, driving our revenue growth from selling residential projects from 30 per cent now to 50 per cent in 2009," he said.

Currently, 70 per cent of CP Land's revenue comes from rental fees and 30 per cent from residential sales.

Meanwhile, CP Land also plans to invest by itself to develop an average of five residential projects in both high- and low-rise styles, worth a combined Bt5 billion a year.

The company has launched its first residential project, The Season on Theparak Road in Bangkok, focusing on the middle-income market.

Somkiat said CP Land and CPMQ's investment plans would have separate customer targets and

locations. CP Land will develop

residential projects focused on the mass market and located in Bangkok and its suburbs. Others focused on the foreign and middle to upper-income market will be developed by CPMQ.

CP Land also a strong interest in investing in retail, industrial estates, and hotels and resorts. It owns 15 property projects nationwide, together worth Bt100 billion.

The company also owns 4,500 rai of land: 3,200 rai in Rayong and 1,300 rai in Bangkok and other provinces.