More private prime sites available for long lease in Bangkok

Land owners taking advantage of growing demand from property developers for prime leasehold sites for new development

November 06, 2018

More private prime sites will be made available for long lease in Bangkok as the owners are lured by a rising opportunity following increased demand from property developers for prime leasehold sites for new development or redevelopment, says JLL. The property consultancy firm's forecast is evidenced by a higher number of private sites that have been put up for lease in the city's prime locations.

Suphin Mechuchep, Managing Director of JLL, says "Long lease is a good option for owners who want to turn their land into income-generating assets on a long term. It is also very favorable to land owners who do not want to take risks of developing a property project on their own."

"On the lessee side, private leaseholds are becoming a more attractive option, particularly for leading condominium developers diversifying into non-residential sectors such as office and hospitality," she adds.

Mrs. Suphin's statement is supported by Mike Batchelor, Chief Executive Officer at JLL's Hotels & Hospitality Group Asia, who says "Ever-increasing land prices have made it less and less feasible to develop rental property on freehold prime land in Bangkok. This explains the growing trend of developers securing leasehold land for non-residential development projects such as hotels, serviced apartments, office buildings and retail centres or mixed-use developments."

"With rent being able to be paid over the duration of the lease period, as opposed to upfront, many developers also have found securing leasehold land to be a better strategy for managing cash flow and deriving stronger investment returns. For some developers this has required additional investment in assets that provide stable income streams such as hotels and serviced apartments. As developers can retain ownership over these final products, they are able to maintain an ongoing stream of income. Lastly, the option to sell in to a real estate investment trust (REIT) makes leasehold properties more viable for developers," Mr. Batchelor adds.

There are a number of private prime sites that are currently offered for long lease. For example, a prime development site in Sukhumvit Soi 6 is put up for lease on a 30-year term. Located right in the middle of bustling Nana, the site has been approved for redevelopment into a midsize hotel development. Also available is a prime site in Asoke offering a potential to be developed into an iconic high-rise hotel development with up to 16,000 sqm of gross floor area. JLL has acted on behalf of the owners of these two sites to secure lessees.

In the most recent case, JLL has been appointed by a private entity to lease a prime site with 2 rai of land on Phayathai Road. The site, which is suitable for an office or hospitality development, is offered for lease on a 50-year term through an expression of interest (EOI) campaign that will close in December.

The past success of major leasing transactions that have completed over the last few years is another factor tempting owners of prime sites to put up their plots for lease. The largest transactions recorded in the last three years include a 50-year lease of a 6-rai site on Silom Road and a 30-year lease of a site of a similar size on Ploenchit Road. The former was acquired by NYE Estate and Minor International that formed a joint venture for a new Grade A office development on the site. The latter was secured by Raimon Land, also for a Grade A office development project. Both leasing transactions were concluded by JLL on behalf of the land owners in 2016.

Photo: Leasehold site secured by Raimon Land in 2016 for a Grade A office development project which is currently under construction

"Over the last few decades, public organisations such as the Crown Property Bureau, the State Railway of Thailand, and Chulalongkorn University have had almost full control over the supply of leasehold development sites in Bangkok's prime areas. While the domination will continue, the increasing availability of private prime sites for long lease will mean new opportunities to property developers," says Mrs. Suphin.

According to JLL, most of the present large mixed-use projects across Bangkok are being developed on land secured from the state or quasi-state enterprises or agencies on a 30-year lease basis. These include One Bangkok by TCC Asset and Frasers Property (104 rai owned by CPB), The ParQ by TCC (24 rai owned by CPB) and Samyan Mitrtown by Golden Land Property Development (over 3 rai owned by Chulalongkorn University). Moreover, last year Dusit Thani renewed the 30-year lease with CPB for the present Dusit Thani Bangkok site on a corner of Silom-Rama IV intersection. The firm also announced the partnership with Central Pattana (CPN) to redevelop the 24-rai site into a mixed use development project where the Dusit Thani Bangkok will be renovated and become part of the new project. 

About JLL

JLL (NYSE: JLL) is a leading professional services firm that specializes in real estate and investment management. Our vision is to reimagine the world of real estate, creating rewarding opportunities and amazing spaces where people can achieve their ambitions. In doing so, we will build a better tomorrow for our clients, our people and our communities. JLL is a Fortune 500 company with annual revenue of $16.3 billion, operations in over 80 countries and a global workforce of over 91,000 as of March 31, 2019. JLL is the brand name, and a registered trademark, of Jones Lang LaSalle Incorporated. For further information, visit

About JLL Thailand

The firm’s operation in Thailand began in 1990 and today is the country’s largest international property service provider with 1,600 employees and more than five million square metres of property and corporate facilities managed. In Euromoney Real Estate Survey 2018, JLL was voted as Thailand’s number one overall real estate advisor for the 8th consecutive year and also won top votes for agency/letting, research and valuation in the same survey. The firm was also named Thailand’s five-star winner in the commercial property consultancy and commercial real estate agency categories at the International Property Awards Asia Pacific 2019/2020. For more information, visit

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