Pruksa on Bt16 bn land-buying spree amid market optimism

Real Estate January 17, 2018 01:00


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LISTED property firm Pruksa Holding Plc has set aside Bt16 billion to buy 70 sites this year for the development of residential projects that will be constructed next year, the company’s deputy group chief executive officer Supattra Paopiamsap said at press conference yesterday.

The company’s chief executive officer-Pruksa Real Estate Premium, Presert Taedullayasatit, said the investment budget would come from the company’s initial cashflow and debentures worth up to Bt5 billion may be issued. Some of the proceeds from the debentures issued would be spent on replacing some of the debentures that will expire this year.

This year the company plans to launch 75 residential projects worth Bt66.7 billion to boost its total revenue to Bt50.5 billion. Up to 44 of the projects will be townhouses worth Bt27.9 billion. Eighteen projects worth Bt19.7 billion will be single detached houses, five will be condominium projects worth Bt8 billion. Eight projects worth Bt11.1 billion are single detached houses, townhouses and condominiums in the premium market priced at more than Bt10 million each, Supattra said.

Last year the company launched only 56 projects, worth Bt59.2 billion; in early estimates last year it had aimed for 72 projects worth Bt60.8 billion. The company had estimated that total revenue would be Bt50.2 billion, but in the first nine months of 2017 revenue was just Bt30.71 billion and net profit Bt3.71 billion. These figures represented declines of 7.2 per cent and 5 per cent, respectively, from the same period of last year, according to the company’s report with the Stock Exchange of Thailand. 

For 2018, the company forecasts that the property market in Bangkok and suburban areas will grow 4.79 per cent from last year, for an estimated total market value of Bt419.7 billion, said the company’s chief executive officer-Pruksa Real Estate Value business, Piya Prayong, who cites the country’s expected economic growth of more than 4 per cent and the government’s proposed investments in big infrastructure projects.

Supattra, who had been chief executive officer of Unilever Thailand before joining Pruksa Holding Plc last year, said that her objective is to build the company’s corporate and products brands to be in the forefront of customers’ minds, especially amid the transition of the company into the digital era. 

“Our strategy will develop residential projects under the concept of a smart home, with attention to home solutions, product quality and after-sales service to serve our customers’ demand,” she said.

“In line with this strategy, we have reduced our product brands from 48 to only 14 and we also plan to build our corporate brand alongside the product brands. “

Meanwhile, the company continues to focus on its core business of developing residential projects for sale, especially those priced at not more than Bt10 million per unit, as the company also plans to increase its sales in the premium market, which is enjoying strong demand, she said.

She added that the company also is exploring ways increase its recurring income on a sustainable basis. 

It is investing to develop Vimut Hospital, which is worth Bt4.9 billion and is under construction. It is expected to be completed in 2020. The project now has two management teams, including Dr Santi Ueanoraset, who is hospital director of Vimut International Hospital Co Ltd, and Trithip Sivakriskul, chief executive officer of Vimut Hospital Holding Co Ltd.