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ANYONE INTERESTED IN Thai real estate recognises the name Sansiri, the property giant behind some of the country’s most luxurious developments.
Since Nov 2017, the billion-dollar company has branched out more broadly into the lifestyle sector, investing in the hotel group Standard International, trendy magazine Monocle, Singapore-based co-working group JustCo and online art gallery Artsy. It has also invested in Hostmaker, a London-based management company for Airbnb hosts, and Farmshelf, a company providing indoor-farming shelves where you can grow your own vegetables.
In Singapore, Sansiri created Siri House on Dempsey Road that is a restaurant, art gallery, property showroom and lifestyle concept store all in one.
The man behind Sansiri’s diversification efforts is Apichart Chutrakul, Sansiri’s CEO who has set his sights on the future while planting his feet firmly on the ground. Mr Chutrakul wants to prepare his company for the kind of disruptions that have impacted several industries such as finance, insurance and the media.
For so long, Sansiri thrived on its real estate business: Overall sales in 2018 was a record US$1.5 billion, up 25 per cent from the previous year. And the combined target for the next three years (including 2019) is US$5 billion, an increase of 15 per cent. In 2019 alone, it is launching 28 new projects worth US$1.5 billion.
But these triumphant sales figures don’t reassure Mr Chutrakul. He wants to future-proof his family’s company by planting its name in other lifestyle brands, so as to “bring Thailand to the world, and vice versa”. Hence, the highly-anticipated Monocle by Sansiri residence in Bangkok, 15 new Standard hotels around the world, the Khun by Yoo condominium featuring Philippe Starck’s design, and a luxe wellness condominium in Bangkok created in collaboration with Japan’s Tokyu Corporation and Thailand’s Samitivej Hospital.
Speaking at Singapore’s Siri House – there is one other Siri House in Bangkok – Mr Chutrakul, 58, shares his vision for Sansiri.
Tell us about the Monocle by Sansiri residence in Bangkok that has many globe-trotting urbanites curious.
We are still working on the details. Monocle and we have agreed on about 80 to 90 percent of things, but there’s still that crucial 10 percent to work out.
What does Tyler Brule want?
(laughs) Tyler (Monocle’s editor-in-chief) wants a lot of things. Don't get me wrong. He is very smart and has his own idea of things. But you’ve got to remember that in Thailand, 50 percent of the residence has to be sold to Thais. So the residence must appeal to Thais as well. We have not agreed on certain concepts, such as the room size – which, of course, makes a lot of difference to the buyer. So we’re trying to accommodate each other. And because this is the first Monocle by Sansiri project, we have to make sure we get it right.
Besides the Monocle project, you’re also juggling several other collaborations.
That’s right. In June, for instance, we are going to launch a wellness condominium in Bangkok, possibly the first in Southeast Asia. We’ve been working with Tokyu Corporation, which is a leader in wellness in Japan, as well as Thailand’s Samitivej Hospital, a leading Thai hospital. It will be built in Srinakarin, which is a little bit on the edge of Bangkok. But it will have excellent facilities such as filtered air in every room, rounded corners on every piece of furniture, larger doors to accommodate wheelchair access, a 24-hour telemedical team for you to consult via your smartphone, and other features. As for the hotel group Standard International, of which we invested US$58 million for a 35 percent stake, our goal is to increase to 26 hotels from the current 10 or so. Many of the contracts have been signed; we are set to expand into Europe and Asia.
Sansiri was already doing well before you embarked on these diversification efforts. Why these moves?
Given the size of Sansiri, our expansion and diversification plans are not aggressive. I’ve always wanted to bring Thailand to the world, and the world to Thailand, to let people know that Thailand exists. Eventually, we will collaborate with these different lifestyle brands to bring the Sansiri name to some extent into the brands. We think disruption is coming to the property sector, as it has to other industries such as finance and the media. And though it’s harder to disrupt the property industry because of its particular systems, we want to change ourselves now and be a first mover. It will cost us much more if we wait too long.
The Bangkok property market is oversupplied, but at the same time shows no signs of collapsing. Is it safe for Singaporeans to consider property in Bangkok?
I always say, our condominiums are one-fourth of the price of Singapore condominiums, and one-fifth of the price of Hong Kong condominiums. So why not get a vacation home in Bangkok, Phuket or Hua Hin for a fraction of the price, for that occasional break from your busy life? Singapore is the third-largest international market for Sansiri properties behind China and Hong Kong. Last year, Thailand attracted a record of 38 million international visitors, which was up 7.5 per cent from 2017. Of these, 10.5 million were from China, which was up 6.9 per cent from the previous year. This year, they expect 40 million tourists. Bangkok is now the most visited city in the world according to a Mastercard study. The Chinese make up a quarter of our tourist numbers, and I don’t know why that is. Maybe there’s a cultural alignment here that makes the Chinese feel comfortable visiting our country. So yes, I think Singaporeans should still be looking at properties in Thailand.
Are you not worried about a bubble, and the fact that several analysts are predicting a recession either this year or the next?
Predictions change all the time… The global economy is not doing the greatest and people are worried about interest rates. But you know, things seem much more in control now than they were at the end of last year. I wake up, switch on the TV, and see analysts predicting a recession. And the next day I wake up, switch on the TV, and see Trump shaking hands with the Chinese over a trade truce. American market is at a record high still at over 26,000. Is that sustainable? I don’t know. Next year is a US election year, so perhaps if things turn for the worse, Trump will do something to mitigate it. But if a downturn does come, we’ll be facing it as a bigger company than before, with bigger equity base, and many more properties and services around the world. But I tell you, I don't foresee it for the property market in Thailand.