Thailand's leading real estate agent

New Bangkok Condo Development by LPN Development

By on Oct 21, 2013 in Property News

Last weekend, LPN opened the first phase of their new Bangkok Condo development, Lumpini Township Rangsit-Klong-1 of 4,000 units (sales prices started at Bt639k/unit or Bt30k/sq.m). The market is likely to react negatively to the disappointing presales (about 2,000 units were booked, a 50% take-up rate of launched units). A sharp share price drop would present an opportunity to BUY because LPN has already achieved its FY13 presales target. The firm has the clearest revenue visibility of our Res Dev coverage.

The response fell far short of management’s target of fully booking the project at launch.The key selling point was the very cheap price, but it is the biggest project ever undertaken by LPN (10,154 units in total, Bt7bn in total value, 50 buildings, eight floors per building on 94 rai). Thus, fully booking the first phase at launch proved an unrealistic ambition amid the economic slowdown. The 50% take-up rate is in line with the industry mean.

Revenue recognition from Rangsit will start in late FY14. The launch made for Bt1.4bn in additional presales, which pushed up secured FY14 revenue from 42% of our top-line forecast to 50%. Although the Condotown brand’s GM typically ranges 26-27%, we think there may be scope for upside at Rangist, due to the cheap land price (9% of project value). Besides, LPN plans to gradually increase sales prices. Looking ahead, the firm will launch three small projects (about Bt1bn each) in 1Q14 with revenue to be recognized in 4Q14.

LPN has now hit its FY13 presales target.

For the full article click here.

No comment





 

emailSubscribe Via Email

Privacy guaranteed. We will not share your information.

Follow Me on Twitter

Follow Me on Facebook

Subscribe via RSS Feed

Copyright © 2020 CBRE (Thailand) Co., Ltd. All Rights Reserved.