Survival strategy

A sluggish residential market forced developers to elsewhere for revenue, including expansion into the niche market of helping people to build their own home, writes Kanana Katharangsiporn

- 

SET-listed developers are exploring ways to diversify risks and increase revenue as the residential slowdown lingers, with projections indicating it will persist for a few more years.

Sorapong Jakteerungkul, senior vice-president at Kasikorn Securities Plc, said many developers are adjusting their strategies to navigate the market downturn, which has been exacerbated by oversupply and sluggish demand since 2023.

“In a typical year, new residential launches would surpass sales as developers aim for growth. Once sales pick up, however, in 2024 new launches were minimal due to reduced demand, resulting in sales figures comparable to the pandemic period,” he said.

FEWER LAUNCHES

A key strategy adopted by several developers this year involves minimising new project launches and focusing on reducing unsold units to improve cash flow and liquidity.

Land and Houses Plc (LH), for instance, scaled back its plans significantly, with only four new projects worth 11.1 billion baht, the lowest number of launches in more than 20 years.

Despite this conservative approach, LH is targeting 23 billion baht in presales and 26 billion baht in transfers by focusing on clearing inventory from existing projects with a combined development value exceeding 93 billion.

SC Asset Corporation Plc is adopting a similar approach, cutting new launches to 15 projects valued at 28 billion baht in 2025, compared with 37 projects worth 51.8 billion baht last year.

Supalai Plc plans to launch 36 new projects worth 46 billion baht in Greater Bangkok and the provinces, though this represents a reduction from 41 projects valued at 52.4 billion last year.

AssetWise Plc also downsized to 10 new projects worth 22 billion baht in Bangkok and Phuket, from 13 projects valued at 36.8 billion last year.

Major Development Pcl has shifted its focus entirely, emphasising existing projects instead of launching new ones.