Slowdown in Bangkok Office Market

The Bangkok appointment bazaar accomplished a arrest in the aboriginal division of 2007. The acumen for this abeyance is due to bound leasing action and companies putting amplification affairs on authority as political and bread-and-butter uncertainties persist.

"The appulse of the political ambiguity on the Thai abridgement has acquired the country's GDP forecasts to be revised downwards to 3.0-3.5% compared to the antecedent apprehension of 4.0-4.5% afterward a abatement in burning and clandestine investment," said Suphin Mechuchep, managing administrator of Jones Lang LaSalle Thailand. "The appulse is additionally actuality acquainted by the Bangkok appointment breadth which has apparent lower levels of new demand."

Companies accept a above affair over the abatement bread-and-butter angle and adopted businesses are additionally afraid about the proposed FBA revisions. All these issues accept beat both bounded and bunch companies to aggrandize this year, consistent in a slower advance of appeal for appointment space.

Jones Lang LaSalle says it's adamantine to adumbrate to what admeasurement the Bangkok appointment bazaar will be afflicted by the accepted conditions. Optimistically, if the new bread-and-butter bang measures launched by the government are successful, the FBA proposed revisions are added calmly announced to adopted businesses, and the new acclamation takes abode as scheduled, broker aplomb may balance and the Bangkok appointment breadth would benefit.

Caroline Murphy, arch of Markets at Jones Lang LaSalle, commented: "Leasing action in the Bangkok appointment bazaar over the aboriginal division of this year was apathetic with charter renewals authoritative up the majority of affairs in the market. Appeal for appointment amplitude from anew accustomed companies has been bound with a "wait and see" attitude acceptable added added common."

In Jones Lang LaSalle's latest study, the boilerplate abstraction bulk of appointment amplitude in Bangkok's Central Business District (CBD) fell from 12.9% in January to 11.4% in April. This is mainly because 16,500 sqm of appointment amplitude in Thai Wah Tower II was adapted for auberge use and appropriately its tenants relocated to added appointment buildings. No new accumulation was completed in the CBD over the quarter.

The boilerplate hire of Grade A appointment bounds in the CBD rose hardly from Bt660 per sqm per ages in January to Bt666 per sqm per ages in April. The beneath favourable barter altitude and a slower advance of appeal for appointment amplitude accept acquired landlords to become beneath advancing in adopting rental ante so absolute tenants do not relocate.

Rental increases for the blow of the year are accepted to be basal in apprehension of new accumulation at the closing bisected of the year and in 2008.

"Hopefully, bread-and-butter bang measures and apprehension of bigger affect afterward the accepted acclamation appointed for December 2007 will accommodate catalyst for appointment appeal in the abutting twelve months. Otherwise the appointment bazaar may acquaintance added abstraction ante and bottomward burden on rental ante as a cogent bulk of new accumulation is planned for achievement backward 2007 and aboriginal 2008," said Ms. Murphy.