Charn Issara launching new REIT

AMONG the various projects well-entrenched listed developer Charn Issara is currently handling is a move to soon launch a new real estate investment trust (REIT).

Songkran Issara, this well-known company’s managing director, said earlier this week that his company is working on converting its property fund worth over 2 billion baht into a REIT. A new hotel being built at the sprawling Sri Panwa estate in Phuket which will house 30 pool suites will be added in for 1.25 billion baht taking the total to over 3 billion baht.

“We are going to build this REIT and make it bigger; we will be adding both Phang Nga and Hua Hin-Cha-am Baba Beach Clubs into it.

“Our goal is to reach 8 to 10 billion baht in five years.”

Mr Songkran explained that the reason companies are busy converting their property funds into REITs is because the authorities are not allowing this type of investment vehicle to grow.

“It is getting too much tax advantage so they are freezing it.”


An artist’s rendering of Baba Beach Club on Phang Nga’s Na Tai Beach.


REITs are popular with Thai investors as they get good return on investment compared to just a little over 1% a savings deposit currently yields. They are also backed by properties which usually are well taken care of and the unit price too sometimes goes up. Charn Issara’s new REIT will likely generate 7% return per annum.

Mr Songkran advised those with small budgets to consider investing in a REIT rather than a modest condominium because they could do so with just 100,000 to 200,000 baht with this type of investment also being very liquid.

“It would be difficult to sell a property but REITs are traded in the stock market.

“However a residence in the city is okay – for example The Issara Ladprao condo, our clients who bought units for 2 million baht are getting 17,000 baht a month rent, which is good.”

Charn Issara is also heading to the Chinese Hainan Island because China-based Junfa Real Estate Company, which is its joint venture partner in the Phang Nga Baba Beach Club project, has asked it to conceptualize a hotel, develop the idea and later bring Sri Panwa in to operate it.

Construction of the 42-rai Baba Beach Club on Phang Nga’s Natai Beach in which Junfa holds a 30% stake is well underway and should be unveiled next year.

This large development also includes six beachfront villas, approximately 40 two-bedroom pool villas and roughly a hundred condominiums as well as other structures. Starting price is 12 million baht and rises to 130 million baht.

An artist’s rendering of Baba Beach Club on Phang Nga’s Na Tai Beach.

By Nina Suebsukcharoen


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