This summer marked the return to Pattaya of a familiar face to the local real estate sector when ex-Raimon Land CEO Nigel Cornick announced his new development vehicle Kingdom Property had secured finance from the Krungthai Bank for their first major project in the city, and indeed Thailand, the THB 2 billion Southpoint condominium on Pratumnak Hill.
The Pattaya Mail recently conducted an interview with Mr. Cornick to discuss his new venture in the local real estate market and to also garner his views on the overall property scene, both in Pattaya and around Thailand in general.
But first, how had the Kingdom Property CEO been keeping himself busy over the past couple of years?
“After leaving Ramon Land in 2009 I went into partnership with the Brooker Group and established Biswanger Brooker (Thailand), a boutique property services company. We were busy helping our clients with acquisitions and the like, but frankly, once you’ve had the bite of development it’s very hard to get it out of your blood,” Mr. Cornick answered.
“For the last 3 years we’ve been looking for opportunities and we were finally able to secure a site,” he continued. “We recapitalized Kingdom Property and bought 4 rai on Pratumnak Hill on soi 7. We were very fortunate to secure this site as it’s not easy to find 4-rai of land consolidated in a prime location such as this.”
Designed jointly by Bangkok based architects The Beaumont Partnership and SODA Thailand (Stephen O’Dell), the plans for Southpoint are for 2 towers, one 20-storey and one 28 storey, with 42,000sqm of living space. The company also promises that South Point with incorporate some eye-catching landscape features.
“Our landscape architect, who is based in Singapore, has come up with some truly unique and innovative ideas for the landscaping for this project. They will really be well worth seeing,” said Nigel.
With prices set to start at approx. THB 65,000 /sqm the company feels the project will be an attractive proposition to many sectors of the real-estate marketplace.
“We’ll test the market but we think the 1 and 2 bedroom units will be the most sought after; that seems to be the feedback we are getting from our research,” said Mr. Cornick.
“It (Southpoint) is a very modular design, if we find that there is more demand for larger units we have the ability to combine the smaller ones,” he added.
The project is expected to be officially launched later this year with presales scheduled for September or October. The decision to hold off from launching presales too far in advance of construction is something the Kingdom CEO says will pay dividends down the line.
“You need to show people what they are going to get, so it’s essential to have a proper sales office and showroom ready so customers can see the quality of the product you are offering,” he said.
And who does Kingdom Property see as their main target sales groups for Southpoint?
“The Russian market you can’t ignore,” said Nigel. “I would think most new developments in Pattaya are achieving at least 20% sales to Russians.
“Also, with the Thai market, the Pratumnak area has historically got connections with the Royal Varuna Yacht Club and a few years ago this was the area that many Thais wanted to live. We are going to try and rekindle that interest and we are talking with Varuna Yacht Club about developing certain associations.
“However, we believe that South Point will appeal to all customers, whether Thai or foreign, looking to invest in a quality development. This (project) will fill a gap between Jomtien and Naklua as both of those areas are getting heavily focused on from a development perspective,” he added.
With some investors holding concerns about the consequences of the financial problems in the Euro-zone, and a possible over-supply of rooms here in Pattaya, how does he view the immediate and long term future for the property market here in the city?
“At Kingdom Property we are firm believers in the real-estate industry in Pattaya,” replied Nigel. “People thought I was crazy when I first came here (with Raimon Land) – certainly my staff at the time did, they just couldn’t see the potential. But I could see that the opportunity was here and apart from a slight hiccup in 2008 the market has continued to grow.
“What happens in the rest of the world doesn’t necessarily reflect in the Pattaya market,” he added. “Most of the major developers here have actually thrived since the 2008 global financial crisis.
“The tourism driver for Pattaya is going to be huge,” he continued. “The mayor is predicting something like 2 million visitors just from India alone in the next 2-3 years, which is significant if you bear in mind the Russian tourist numbers now are about 700,000.
“There are something like 47,000 hotel rooms in Pattaya of varying standards, but we see the main call in the future coming for the 3-4 star market. Demand for accommodation will be the driver for investment decisions. Possibly tour groups will purchase blocks of units in developments. There are many diverse investment opportunities that are going to be created because of the momentum,” Nigel added.
The disastrous floods that hit other parts of the country last year also seemed to see a shift in the focus of investors who began to look at Pattaya and the Chonburi region in general as a more attractive proposition for future property acquisitions. Does Kingdom Property also share this viewpoint?
“Yes, the industrial base in the Eastern Seaboard is going to continue to grow and we expect the take up of industrial land in the area to be the highest ever following the flooding last year that affected the other parts of the country,” replied Mr. Cornick. “Just on the industrial base alone, you have to be confident that Pattaya is going to be ahead of the field.”
And how does the city compare to other resort destinations in Thailand?
“Phuket was rightly considered to be the jewel in the crown, and in many respects it still is” says Mr. Cornick, “but it was hit hard by the 2008 economic crisis and hotels and resorts there have had to adjust their room rates to attract more of the larger tour groups, which means the island has maybe lost a bit of its shine in recent times.
“Hua Hin, because of the royal family connection has traditionally always been a popular destination for Thais, but Pattaya, with its myriad of attractions, is starting to appeal more now to the younger Thai buyers,” he added.
Does he see any potential stumbling blocks for Pattaya’s development in the future?
“The planning and implementation is where Pattaya has got to look at itself, look to improve its infrastructure: water, sewerage, roads etc. – it’s the major challenge for this city but we remain hopeful,” replied the Kingdom Property chief.
Southpoint marks the company’s first foray into real estate development, so what can we expect in the future from Kingdom Property?
“We’ve got 2 other projects we are looking at in Pattaya, hopefully we will be able to secure at least one of those in the next 6 months,” replied Nigel. At the moment we are primarily focusing on Pattaya and the Eastern Seaboard, but if something interesting came up in Bangkok or elsewhere, possibly as a joint venture, then we would look at it on its merits,” he added.
As a final note Mr. Cornick left us with his positive perspective for Thailand’s economy in general.
“This country is the number 1 tourist destination in Asia and I don’t see that changing,” he said. Thailand is unique in that it opens itself to all nationalities, religions etc., and as long as the political situation remains stable there is no reason why we shouldn’t be confident about the future here,” he concluded.