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Bangkok Office Information
Overview
Bangkok office space offers a wide range of offices for rent and a wide choice of locations. Office rentals reflect the locations, access to transport and the grade of office building and facilities.
Office areas in Bangkok are concentrated around the CBD which covers Silom, Sathorn, Wireless and Sukhumvit roads. However, office properties are available throughout town and other principle office locations including Ratchadapisek. CBRE covers all types of office property in all Bangkok locations from the areas above through to suburban and midtown locations such as Ratchadapisek, Viphavadi-Rangsit, Chaengwattana and Bangna.
Proximity to mass transit systems has become a priority for Bangkok office tenants. There are two existing mass transit systems: the BTS sky train and the MRT subway, which serve primarily the central and midtown locations of Bangkok.
Bangkok Areas/Locations
Office locations in Bangkok can be geographically classified into two main regions, which are:
Bangkok CBD (Central Business District)
Defined as the area incorporating Silom, Sathorn, Rama IV Road, Ploenchit, Wireless Road, Asoke, and the early Sukhumvit area (Sukhumvit Road up to the Asoke intersection).
Core CBD The core CBD includes Silom, Sathorn, Wireless and Ratchadamri Road, passing through Rama IV and Ploenchit Road.
The majority of Bangkok’s grade A office buildings and the headquarters of many multinational companies are located here. The area is served by both of Bangkok’s mass transit systems.
Outer CBD This area covers the primarily residential areas of Bangkok along the BTS sky train route, specifically the early Sukhumvit area and Asoke.
Non-CBD There are a number of suburban and midtown office locations in Bangkok. These are popular with companies requiring convenient access to downtown as well the industrial areas and the airport. Generally as can be expected office locations along mass transit routes have become increasingly popular.
Chaengwattana, in the north of Bangkok, is a major government administrative centre.
To the east of the city, close to Suvarnabhumi International Airport, is the Bangna-Trad district. This area not only provides good access to the airport but is also the gateway to the Eastern Seaboard.
Petchaburi Road and Sukhumvit Road extend to the east of Bangkok, with the BTS running along Sukhumvit and the airport link running parallel to Petchaburi. Rama III Road runs along the river, providing good road access to the city centre and easy connections to eastern Bangkok via the Industrial Ring Road.
Hot Deals
There are currently a number of opportunities available in Bangkok office they are classified as Hot deals due to either being the best prices in a particular building or location, the hottest spots in Thailand’s property market or a sought after property rarely available for acquisition.
Equinox The Office
Place
Size: 847-905 sqm
Prime location with
access from two main
roads - Phaholyothin &
Vibhavadi-Rangsit THB 600/sqm/mth
On Ratchadapisek Rd.
Size: 1,700-7,900 sqm
Premium grade A
eco-friendly office bldg.
1-min walk to MRT THB 650-700/sqm/mth
Why Hot? Special pre-leasing
prices
Bangkok Office Types
Bangkok offices can be segmented into two core types.
Single Ownership Most office developments are high-rise purpose-built properties owned and operated by a professional office landlord
Multiple Ownership There are also a limited number of multiple ownership office developments, known as office condominiums in Thailand (in other countries as strata title offices). Those premises have been sold to individual owners. The main difference is the management of the property where a management company, supervised by a committee of co-owners, manages the common areas. The individual owners are responsible for the maintenance of their own office units.
Bangkok Office Classification
CBRE Thailand has developed a grading system and grade A offices have the following characteristics:
A regular shaped floor plate without structural encumbrances, which can be easily divided.
An air-conditioning system with a central chiller and variable air volume, rather than a constant air volume from a water-cooled system.
Lifts with low wait time. Lifts should be allocated to different floor zones. A separate service lift with its own lobbies should also be provided
The common areas, particularly the main entrance and floor lobbies, should have an impressive design, and high-quality fittings and decoration
Ceiling heights inside offices should be at least 2.7 metres
Professional building management
Car parking layout should have smooth and efficient entry and exit routes
There is also a broader class of popular and successful office buildings in Bangkok, which CBRE Thailand classifies as grade B offices:
These might be seen as of lower quality but they benefit from good locations, which may offset other factors. Tenants that are prepared to take space in lower quality buildings will benefit from lower costs of occupation
Bangkok Travel Infrastructure
BTS (Bangkok Transit System/Sky Train) The BTS or sky train is a critical transport system in Bangkok, covering much of the city centre and its many commercial, residential and tourist areas. The sky train and subway systems intersect at Silom, Siam, Asoke and near the weekend market, enabling Bangkok’s residents to access a large part of the downtown area.
MRT (Mass Rapid Transit) The MRT is Bangkok’s first subway or underground system and currently has one line, although various others are being planned.
ARL (Airport Rail Link) A new airport rail link is currently under construction and is expected to start operations in 2009.
BRT (Bus Rapid Transit)
Bangkok’s first BRT line is now under construction. The buses will run from a new sky train interchange at the Chong Nonsi BTS station along Narathiwas-Ratchanakarin Road and the length of Rama III Road before crossing the river at the Rama III Bridge, to end at the Ratchadapisek-Ratchapreuk Intersection in Thonburi.
Expressways For drivers, a comprehensive network of expressways cross Bangkok accessed via ramps through toll booths.
Buses Bangkok has a comprehensive bus network, consisting of publicly run and private buses bus fares are paid to the conductor for each trip. Buses are both air-conditioned and non-air-con. The quality of buses is variable so choose the orange air-conditioned Euro buses which are the best in terms of comfort and safety.
Taxis/Tuk Tuks Bangkok’s taxis and Tuk Tuks are plentiful and relatively cheap. Taxis tend to have meters(although ask to have it switched on) each Tuk Tuk trip requires a negotiation
Bangkok Office Rental - Example Lease Terms
A Bangkok office usually has the following terms and conditions:
Office Lease Term
Leases for commercial office space in Bangkok are usually for three years. Options to renew are available. The rental for the renewed lease terms is subject to mutual agreement. It is possible to have an office lease term for longer than three years. However, this requires the lease to be registered, and this incurs costs and taxes.
Basis of Measurement
Most office landlords quote areas on a net lettable basis, measured from the window to the core area including columns but excluding common corridors, washrooms and plant rooms.
Deposit
Office deposits are generally for 3 months’ gross rental, non-interest bearing, refundable upon expiry of the lease
Rent-free Fitting Out Period
This depends on the sizes of the office space leased. For example, a tenant with 1,000 square metres should be able to get a two month rent-free period for fitting out.
Bangkok Office Running Costs
In addition to the rent, there will be other costs as detailed below:
Electricity
The standard rate is 4.50 - 5 Baht per kilowatt per hour and bills are paid directly to the landlord.
Air-conditioning
Almost all offices for lease have central air conditioning systems; however, there are two common systems used in Bangkok offices. The type affects your occupation costs. If the building uses a water-cooled package, tenants will pay for the electricity consumed by their package units, adding 40-50 Baht per square metre per month to the rental. If the building uses a central chiller system, the landlord absorbs the cost of providing air-conditioning.
Air-conditioning after hours (overtime air-conditioning)
Normal office hours at most buildings are 8:00 a.m. to 6:00 p.m. on weekdays. If air-conditioning is required outside of these hours, the tenant usually pays a charge of 2.00 Baht per square metre per hour.
Telephone lines
Office tenants usually apply directly to the telephone service provider for the installation ofthe lines required, but will pay a non-refundable installation charge to the landlord. Bills are paid directly by the tenant to the telephone company.
Car parking
Most offices in Bangkok have been built to a minimum standard set by the Bangkok Metropolitan Authority (BMA). This is one space for every 60 square metres of lettable area. Few Bangkok offices provide a more generous parking provision. Tenants can expect one space free of charge for every 100 square metres of office space leased. Extra spaces can be rented on a monthly basis, if available.
Management Fees, Service Charges and Local Property Tax These are usually included in the gross rental which is quoted for leased office space. The gross rental will be split between two or three contracts to reduce the landlord’s tax liability.
Up to 60% of the gross rental will be allocated for services or rental of equipment for which 7% VAT (Value Added Tax) is levied. Usually household tax of 12.5% per annum (based on the rental of commercial office space) is paid by the landlord.
Fitting Out Costs
The capital costs of fitting out, including loose furniture but excluding office equipment such as the PABX, will be 12,000 – 18,000 Baht per square metre. Normally, the leased unit will have to be reinstated to its original handover condition upon expiry of the lease.
Office Research and MarketView
Summary
The growth in demand and lack of new supply means that rentals are increasing and vacancy falling at a faster rate.
Demand is growing; there is limited future supply and rents are rising. Overall vacancy was 12.1 %, while the CBD Grade A vacancy rate was 14.0%.
Total net take-up in 2012 was 160,000 square metres, almost double the take-up in 2011. By the end of Q4 2012, the total office supply increased to 8,093,818 square metres, a 0.2% increase Q-o-Q and a 0.3% decrease Y-o-Y. The supply grew by 13,000 square metres upon the completion of the Ratch Building in this quarter.
Overall, 7,110,598 square meteres of space was occupied in the Bangkok office market, up by 0.9% Q-o-Q and 2.0% Y-o-Y. The occupancy rate improved slightly to 87.9% this quarter, from 87.3% in the previous quarter.
Office rents increased for both grade A and grade B offices in CBD and non-CBD areas. The highest rents are in new grade A buildings in the CBD. In Q4 2012, average rents for grade A office space in the CBD rose by 2.1% Q-o-Q and by 9.1% Y-o-Y to THB 766 per square metre per month. Therefore, we think that the increase will be more this year, with a rise of 10-15%.
The spread in rents in Bangkok is not as great as other countries. The most expensive rent in 2012 was at Park Ventures at THB 925 per square metre per month, the cheapest rents for a Grade B building in a non-CBD location without access to mass transit was THB 350 per square metre per month.
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CBRE Thailand has developed a grading system and grade A offices have the following characteristics:
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The BTS or sky train is a critical transport system in Bangkok, covering much of the city centre and its many commercial, residential and tourist areas. The sky train and subway systems intersect at Silom, Siam, Asoke and near the weekend market, enabling Bangkok’s residents to access a large part of the downtown area..jpg)
A Bangkok office usually has the following terms and conditions:.jpg)
In addition to the rent, there will be other costs as detailed below:.jpg)
Management Fees, Service Charges and Local Property Tax
7,110,598 square meteres of space was occupied in the Bangkok office market, up by 0.9% Q-o-Q and 2.0% Y-o-Y. The occupancy rate improved slightly to 87.9% this quarter, from 87.3% in the previous quarter.
