BANGKOK LAND RALLYING DEVELOPER PLANS MASSIVE INVESTMENT
Bangkok Post - 15 September 2010
The listed developer Bangkok Land Plc plans to make its biggest investment in 12 years with several developments after clearing its 52-billion-baht debt resulting from the 1997 economic crisis.
The new projects will range from condominiums and hotels to a shopping centre worth a combined 15 billion baht in the Srinakarin and Makkasan areas and inside Muang Thong Thani on Chaeng Watthana Road.
Chairman and CEO Anant Kanjanapas said Bangkok Land had repaid all of its debts and was now ready to move on with three new developments.
"We spent 12 years freeing ourselves from massive debts. From now on, we believe Bangkok Land can grow and turn a profit again," he said.
The company has a land bank worth 35 billion baht including 1,500 rai on Srinakarin Road, seven rai next to the Airport Rail Link's Makkasan station, and undeveloped land at Muang Thong Thani.
For its new investments, Bangkok Land will focus on three business categories _ property, exhibition and convention centres and mass transit.
"It's too risky to put all of our eggs in one basket. Diversification will allow each unit to support the others. We'll gradually launch new projects next year depending on market demand, and not thousands of units like in the past," said Mr Anant.
The company plans to develop two 5-billion-baht condominiums next year at Srinakarin Road and Muang Thong Thani. First-phase sales have unit prices from 1-2 million baht.
As well, a four-star Novotel Hotel near its Impact Exhibition Centre will be completed early next year. The company will then introduce a 100,000- square-metre shopping centre and a five-star hotel close to a lake at Muang Thong Thani. The two projects will cost a combined five billion baht.
For low-rise residential development, a new shophouse project on Sukhothai Avenue 99 at Muang Thong Thani will kick off this year.
Mr Anant said the company was also concerned about generating rental income for its cash flow. After establishing Impact as one of the capital's key venues for meetings and exhibitions, it plans to build another Impact in the Makkasan area.
Called Impact Forum, the project will house a 2,000-seat auditorium, a 2,000-sq-m ballroom, a six-star hotel with 500 rooms and retail space."The Makkasan complex will cost 3-5 billion baht and be finished by 2014," he said.
To finance the Makkasan project, Bangkok Land plans to seek a listing for Impact Exhibition Management Co on the Stock Exchange of Thailand. Its executives have already discussed the listing with Kim Eng Securities and hope it can happen as soon as early next year.
However, Bangkok Land will remain the major shareholder in the unit, as its revenue is expected to double in the next five years from 1.8 billion baht this year.
Bangkok Land also plans to bid for the Pink Line mass-transit project. Discussions and plans are well advanced, while bidding partners have already been selected.
"We're still waiting for all official documents before tendering our bid," said Mr Anant.
The developer will bid to build the Pink Line's electric railway, stretching 37 kilometres from Khae Rai to Min Buri, passing Muang Thong Thani as well. The project cost is estimated at 37 billion baht. The government will spend 20 billion baht on supporting infrastructure, while the private sector will make up the rest.
The project's contractor will obtain a 30-year concession to operate the railway. Bangkok Land will issue bonds to raise funds to finance the Pink Line project if it wins the bidding.
"We see high potential to grow revenue from this business, because Muang Thong Thani is a big community of 300,000 people and Impact attracts some 15 million visitors annually. The area will grow even more with the mass transit," said Mr Anant.
Bangkok Land shares (BLAND) closed yesterday on the Stock Exchange of Thailand at 89 satang, down 2 satang, in trade worth 142 million baht.
Impact, Thailand's largest convention centre, plans to invest Bt3 billion to build two more hotels and an entertainment complex over the next three years. It is also interested in managing convention centres in Chiang Mai and in the new Government Complex in Chaeng Wattana.
Paul Kanjanapas, managing director of Impact Exhibition Management, the operator of Impact Muang Thong Thani Exhibition and Convention Centre, said the company planned to build a four-star hotel featuring up to 400 rooms in Impact. The hotel will be managed by an international chain.
The company also plans to build a budget hotel, possibly of 80 rooms, in the same area, and an entertainment complex, as well as improving infrastructure, meeting rooms and facilities. It has already built a hotel with 380 rooms worth Bt600 million under management of Novotel. The hotel's grand opening is set for May. It is expected to bring in revenue of Bt200 million in the first year of operation.
"This new expansion will generate 30 per cent more revenue for Impact after three years of operation," Kanjanapas said. He said the company was also interested in managing Chiang Mai Convention Centre, construction of which is to be completed this year.
Moreover, it has submitted a bid to manage the new Government Complex in Chaeng Wattana. The government will announce the management firm today. The other two rivals are Centara Hotels and Resorts and Miracle Grand.
Kanjanapas said the company planned a project development featuring a convention centre and a hotel in Makkasan, with estimated investment value of Bt6 billion. He added that the company invested Bt2 billion in 2010, mostly on new parking areas, a new entrance and lobby, and shops in the centre. Some renovations are continuing through this year.
Moreover, one more indoor parking building will be constructed to accommodate 2,000 cars.
This year, the company will for the first time host the Motor Show, the Money Expo and the second BOI Fair 2011, as well as another 800 events.
These moves are in keeping with its vision to be ranked among Asia's top-five exhibition and convention centres in terms of customer satisfaction.
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