The Return of Property Consumer Confidence
In the past month, the National Council for Peace and Order (NCPO) has made overdue payments to rice farmers, rebooted state spending and appointed new members to the Board of Investment, resulting in improved consumer confidence in the Thai economy.
Subsequently, businesses are resuming regular activities to cash in on the pick-up in purchasing power. Construction and property development have been among the first sectors to become more active, and Thailand’s major banks are seeing loan demand return.
Vasin Vanichvoranun, executive vice president of Kasikorn Bank, commented that property developers who were focusing on selling their existing projects will be resuming new projects in the second half of the year. Also, apart from residential developments, the bank has seen a rising trend of mixed-use projects.
In July, Kasikorn was one of two lenders to support IconSiam, a high-end integrated real estate project by the Chao Phraya River. Siam Commercial Bank also provided a loan of THB 2.69 billion to Golden Land Property Development for the FYI (For Your Inspiration) Centre, a mixed-use office building and hotel project on Rama IV and Ratchadaphisek Roads.
Large-scale property developers will require funding through bank loans and property funds, including real estate investment trusts (REITs). The latter will be especially important; REITs worth a total of THB 30 billion to 40 billion are expected to be launched in the current half of the year.