Rough cost per sqm for building condos?

Chachoengsao, Chanthaburi, Chon Buri, Prachin, Pattaya, Rayong, Sa Kaeo, Trat

Moderators: Sometimewoodworker, MGV12, BKKBILL

Rough cost per sqm for building condos?

Postby mattar » Thu Sep 06, 2007 2:23 pm

Hi,
We (me and my partner who's married to a thai) want to explore the potential of building houses and apartments in the east region of the Rayong area (i.e. Ban Phe, Mae Phim...)

What is a rough estimate on cost per sqm for building apartments. I've seen in this forum that an average cost per sqm to build a house in the Pattaya area is between 6 000 baht to 10 000 baht for a full service company. Should we calculate the cost at the same level or higher/lower. This is only for us to be able to create our first calculations/estimates.
Thank you very much for your help!
mattar
 
Posts: 4
Joined: Thu Sep 06, 2007 1:50 pm

Postby jazzman » Thu Sep 06, 2007 3:16 pm

Hi Mattar

You're hardly likely to get a house built , turn-key, on the eastern littoral for 10,000 baht per m2 unless you roll your sleeves up and do it yourself.

The condo question depends enormously on the quality of the finish and the facilities you build with it like parking, swimming pools, laundry, cafeteria, lobby, lifts (elevators: 1, 2 or 3). Are they furnished or part furnished? (many luxury condos are), are the kitchens part or fully equipped? Some are.

Then you have to calculate
the cost of selling the whole thing. Advertising real estate is extremely expensive. A billboard on Pattaya's Sukhumvit Road costs 90,000 baht per month. Magazine adverts start at around 15,000 for 1/4 page, and you will need a sales office, staff, and a fully furnished mock up. Then agents will want 3% commission too.

The best thing to do is to take time to get out and about and visit some that are for sale (114 projects in Pattaya alone) and get an idea. The selling price is about 200% of the building cost. 45 - 60m2 flats go for anything from 1,2 mil to 6,5 mil baht).

Don't forget that with condos
, it's the location more than anything else which dictates the price. Prime real estate is of course always on or near the beach. people just love the seaside:P

Example:
Non luxury condominium, Pattaya 2nd Road, 79 units, average 45 m2 . Swimming pool, lobby, underground parking:
Build cost 130,000,000. According to Thai law, not more than 49% of the apartments may be sold to foreigners. (unless they are buying in the name of their wives).
jazzman
 
Posts: 2161
Joined: Wed Dec 06, 2006 9:11 pm
Location: Thailand

Postby mattar » Thu Sep 06, 2007 4:12 pm

Thank you Jazzman for your quick and helpful reply (also the info about marketing) :) !!

To give some more info about our thoughts for the condos:
- They will probably be a total 12 or 16 divided into 2 sizes, 90-95 sqm and 140-150 sqm
- The building will probably be placed approx. 100-150 meters from sea with a main road between
- A swimming pool in the front.
- Parking lot and entrance behind the building
- Luxury condos, fully equipped and furnished before selling

Regarding the calculation:
- Equipment in kitchen and bathrooms/toilets should be included (white goods)
- The furnitures was ment to be excluded, but is always good to have a calculation on also of course, but that's depending on number of rooms etc.
- Selling price could be 6 mil to 7,5 mil baht for the small ones (90-95 sqm) and 10 mil to 13 mil baht for the larger ones (140-150 sqm).


We've been looking around a bit so we know the selling prices, but we just wanted to have an idea about the building cost also and it seems we're getting there.

Is it really possible that everyone of these projects in Pattaya (>110) that you mention expect to sell more than half of the condos to thai inhabitants? They must have found a way to bypass that somehow????

Again thank you!!!
mattar
 
Posts: 4
Joined: Thu Sep 06, 2007 1:50 pm

Postby jazzman » Thu Sep 06, 2007 6:07 pm

They don't need to bypass - the rest get purchased in the names of their wives. Due to the different marketing methods employed, some condo projects sell more to Thais, others sell up to 80% to foreigners. Some purchasers are investors who buy several flats.

Sales are fast, usually 20%, sometimes 40% are sold even before construction starts.

The most successful selling condo projects are usually those which have a foreign company or consultant taking care of the sales and/or marketing, and who are targhetiing foreign buyers. This does not mean that there are no wealthy Thais looking for beachfront flats.
Those that rely purely on Thai marketing methods generally sell slower. It all depends on the target buyer vis-à-vis the advertising budget.

By a construction cost of around 100,000,000 it would be normal to spend 10 - 15 mil on the entire sales and marketing operation including agency commissions if agents are allowed to sell too. Projects which are confident they can manage their own sales, economise of course on the commissions.
jazzman
 
Posts: 2161
Joined: Wed Dec 06, 2006 9:11 pm
Location: Thailand

Postby rosegate » Fri Sep 07, 2007 6:18 am

mattar wrote:Thank you Jazzman for your quick and helpful reply (also the info about marketing) :) !!

To give some more info about our thoughts for the condos:
- They will probably be a total 12 or 16 divided into 2 sizes, 90-95 sqm and 140-150 sqm
- The building will probably be placed approx. 100-150 meters from sea with a main road between
- A swimming pool in the front.
- Parking lot and entrance behind the building
- Luxury condos, fully equipped and furnished before selling

Regarding the calculation:
- Equipment in kitchen and bathrooms/toilets should be included (white goods)
- The furnitures was ment to be excluded, but is always good to have a calculation on also of course, but that's depending on number of rooms etc.
- Selling price could be 6 mil to 7,5 mil baht for the small ones (90-95 sqm) and 10 mil to 13 mil baht for the larger ones (140-150 sqm).


We've been looking around a bit so we know the selling prices, but we just wanted to have an idea about the building cost also and it seems we're getting there.

Is it really possible that everyone of these projects in Pattaya (>110) that you mention expect to sell more than half of the condos to thai inhabitants? They must have found a way to bypass that somehow????

Again thank you!!!


For a decent good quality full service builder in the Pattaya area, your be looking at prices starting at around 13,000 baht per sqm ++, As Jazzman has already stated, everybody likes sea view condos & the higher the finish & more facilities offered the higher the building costs will be, but in turn of course this can be justified by the selling price.

Advertising prices in Pattaya vary hugely, but this magazine (link below) offers good rates, published once a month.

http://www.thailandrealestatemagazine.com

Obvously building a new condo it needs to marketed properly as Jazzman has already stated, you need to get in known to as many people as possible, then it will sell.
rosegate
 
Posts: 57
Joined: Tue Mar 13, 2007 4:25 pm
Location: Pattaya

Postby jazzman » Fri Sep 07, 2007 7:44 am

There should be no need really for anyone to be paying the full advertising space price as advertised in a publisher's media kit, and as Rosegate states, prices vary immensly - based of course on the type of the readership more than anything, rather than on the number of copies or the type of paper. Go-Go bars / tattoo parlours and luxury condos are not an ideal mix.

Registered marketing firms and registered advertising agencies can get a significant discount on the price of magazine and billboard advertising. Often they keep this secondary profit for themselves, which is of course due to them as they do all the work, but occasionally they may pass some of these savings on to their clients.

It's worth noting however, that very often, the 'local' German or English language magazines such as, just for example, the kind which abound in places of high foreign residency like Pattaya, Phuket and Hua Hin might actually be owned (cloaked) by real-estate agents themselves to be able to give themselves a vehicle for free advertising. The magazines do of course contain a lot of news, essential local information, and classified ads but do not often generate sales from people in the market for luxury condos. The best Thai based magazines are published only in German.

It costs nothing to produce a free CC magazine. All the production costs and a huge profit for the publisher are covered by the advertising.

Advertising luxury condos in international upmarket Controled Circulation lifestyle magazines will cost upwards from £55,000 ($111,000) for a full page. The best ones are in-flight magazines on Thailand bound flights. Again, only registered international advertising agencies can normally hope to obtain significant discounts.
jazzman
 
Posts: 2161
Joined: Wed Dec 06, 2006 9:11 pm
Location: Thailand

Postby rosegate » Fri Sep 07, 2007 11:24 am

jazzman wrote:There should be no need really for anyone to be paying the full advertising space price as advertised in a publisher's media kit, and as Rosegate states, prices vary immensly - based of course on the type of the readership more than anything, rather than on the number of copies or the type of paper. Go-Go bars / tattoo parlours and luxury condos are not an ideal mix.

Registered marketing firms and registered advertising agencies can get a significant discount on the price of magazine and billboard advertising. Often they keep this secondary profit for themselves, which is of course due to them as they do all the work, but occasionally they may pass some of these savings on to their clients.

It's worth noting however, that very often, the 'local' German or English language magazines such as, just for example, the kind which abound in places of high foreign residency like Pattaya, Phuket and Hua Hin might actually be owned (cloaked) by real-estate agents themselves to be able to give themselves a vehicle for free advertising. The magazines do of course contain a lot of news, essential local information, and classified ads but do not often generate sales from people in the market for luxury condos. The best Thai based magazines are published only in German.

It costs nothing to produce a free CC magazine. All the production costs and a huge profit for the publisher are covered by the advertising.

Advertising luxury condos in international upmarket Controled Circulation lifestyle magazines will cost upwards from £55,000 ($111,000) for a full page. The best ones are in-flight magazines on Thailand bound flights. Again, only registered international advertising agencies can normally hope to obtain significant discounts.


I really have no idea what a Free CC magazine is?

I would be very suprised to hear than any developer in & around Pattaya is going to pay 55,000 pounds sterling (3 million baht approx) to advertise 1 page in any magazine, International or otherwise

I seem to recall sometime ago "Raimon Land" publishing a statement in the press saying that the highest percentage of Thailand up-market properties are being bought by British buyers

When I first started I advertised in the German local press, over a six month period I never recieved one enquiry
rosegate
 
Posts: 57
Joined: Tue Mar 13, 2007 4:25 pm
Location: Pattaya

Postby mattar » Fri Sep 07, 2007 12:35 pm

I really appreciate your thoughts in this as the marketing/selling side of this will be a challenge without doubt I think. We'll probably aim our efforts to reach potential buyers in Scandinavia, UK and Russia (incl. Baltic Islands).

/Mats
mattar
 
Posts: 4
Joined: Thu Sep 06, 2007 1:50 pm

Postby jazzman » Fri Sep 07, 2007 9:27 pm

rosegate wrote:
I really have no idea what a Free CC magazine is?

I would be very suprised to hear than any developer in & around Pattaya is going to pay 55,000 pounds sterling (3 million baht approx) to advertise 1 page in any magazine, International or otherwise

I seem to recall sometime ago "Raimon Land" publishing a statement in the press saying that the highest percentage of Thailand up-market properties are being bought by British buyers

When I first started I advertised in the German local press, over a six month period I never recieved one enquiry


CC is Controlled Circulation. That means you sell advertisinq space in a freely distributed magazine and the advertisers can call on an outside audit to prove that you have genuinely distributed that number of copies to specific addresses. It has been known for rogue magazines to sell expensive advertising space and send nothing out but grace copies to the advertisers.

Developers of multi-building complexes such as Chateau Dale, Pattaya Garden City, and Northpoint will easilmy allocate such budgets.

If you advertised in the local German press, it depends entirely on the quality of the design, layout, and copy of your ad. All advertising copy needs a specific text and design that answers to the mentality of the target public unless special efforts have been made to research a global solution such as pure branding. German speakers - that means Germany, Austria and Switzerland, with a combined population of well over 100 million, are among the largest number of purchasers in Thailand. They also have a significantly higher disposable income than the Brits. It should come as no surprise that the lingua franca in Pattaya is German, not English. One must address them in a language, and in a way that they understand.
(PhD thesis CCS 1988, Faculty of Kommunikationswissenschaft, Technical University, Berlin)
jazzman
 
Posts: 2161
Joined: Wed Dec 06, 2006 9:11 pm
Location: Thailand

Postby mattar » Fri Sep 07, 2007 9:32 pm

Hmmmm....
Perhaps we should consider expanding our efforts with marketing to Germany also, but as you (Jazzman) say it must be in that case in German.
mattar
 
Posts: 4
Joined: Thu Sep 06, 2007 1:50 pm

Postby jazzman » Fri Sep 07, 2007 9:53 pm

Natürlich :)
jazzman
 
Posts: 2161
Joined: Wed Dec 06, 2006 9:11 pm
Location: Thailand


Return to Eastern Region (including Pattaya)

Who is online

Users browsing this forum: No registered users and 1 guest