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Bangkok Office – AIA Thailand Looks to Property Investment

By on Dec 23, 2013 in Property News

AIA Thailand, the country’s largest life insurer by premiums, plans to invest in offices for rent in major provinces to capitalise on strong demand.

Anucha Laokwansatit, AIA Thailand’s general manager and chief investment officer, said office demand in major provinces is strong but supply is still limited. The firm is interested in investing in office buildings for rent in Chiang Mai and Khon Kaen provinces.

“In Chon Buri, there is also demand for office spaces from many companies in industrial estates, but there is no supply. Most of them rent shophouses instead,” he said.

Mr Anucha said the company would discuss opening up investment regulations in the provinces with the Office of the Insurance Commission next year.Insurance firms can now only invest in property in Greater Bangkok.

The company is interested in property investment because it generates a higher yield than other investment tools. Office of buildings have a yield of at least 8% a year, while government and state enterprise bonds or domestic warrants are lower than 5%.

AIA Thailand’s investment assets exceed 600 billion baht, with domestic bonds accounting for 60%, stock market shares 13%, foreign bonds 7% and domestic warrants, state enterprise bonds and policy loans 5% each, with property in two office buildings 2%.

In June 2014, the AIA Capital Center,the company’s first property development, will be complete. With an investment of 6 billion baht, the 34-storey LEED gold-certified building will have a total lettable area of 60,000 square metres. The rental rate will be 650-800 baht per sq m a month for a three-year contract.

With full occupancy, income will be nearly 600 million baht a year. It expects to have occupancy of 70% the first year,rising to 80% or 90% later.

For the full article, please visit http://bit.ly/1cfM0sK

Source | Bangkok Post 18 December 2013

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