Labour shortage persists

Developers are struggling with a labour shortage and find themselves having to delay delivering residential units to customers. |This has forced them to sign long-term contracts with building contractors.

"We have to find a way to support our contractor to build our two residential projects that will be launched in the second quarter of this year worth Bt1.2 billion to Bt1.5 billion," Parichart Thavornsakcharoen, director of Orin Development Co, said yesterday.

The company had to push back construction of its first condominium project, the Bt500-million Origins Rama II, about six months last year when its contractor could not secure enough workers. The company had to find a supplier to support its contractor so that condos could be transferred to buyers starting in the fourth quarter of last year, she said.

The company will now find more than one contractor to support its construction.

Orin Development was established in 2009 with registered |capital of Bt120 million by Parichart and her partner Surawut Manasomjit.

Origin Rama II was sold out and about 60 per cent of the project value or Bt300 million was turned over to its customers last year. The keys to the remaining Bt200 million worth will be handed to buyers this year.

The two new projects for this year are expected to drive its revenue up by at least 10 per cent a year. All of its residential projects are on Rama II Road, which sees strong demand for housing units priced at not more than Bt3 million, Parichart said.

Issara Boonyoung, president of the Housing Business Association, said it had complained to the Labour Ministry about the labour shortage in the construction and property businesses.

It especially wants a review of the ban against migrant workers leaving their registered workplace, because the nature of the property business is that contractors have |to move their workers to a new |site when the existing project is completed. However, the association has not had any feedback from the ministry.

"The increase in the minimum wage to Bt300 did not affect our business because we pay more than the minimum. Our problem is a deficit of more than 200,000 workers covering both contractors and developers," he said.

Prefabrication system

The top 10 listed property firms have solved their labour problem by producing their own prefabricated modules, which reduces construction crews by 20-30 per cent.

They have also signed long-term agreements with contractors to help them deliver residential units to their customers on time.

Thongma Vijitphongpun, managing director and chief executive officer of Pruksa Real Estate, said the company had created a system combining construction management and prefabrication.

It also helps the company ensure that it can deliver an average of 10,000 residential units a year to its customers on schedule.

Srettha Thavisin, president of Sansiri, said that as the company expands upcountry it had to make sure that its construction process will not face labour shortages, so it put up a prefabrication plant in Pathum Thani last year.