Mr Anuphong (right) studies documents alongside Mr Gill at a signing event yesterday.

The listed developer Asian Property Development Plc (AP) has found a strategic partner in the Singapore-based Pacific Star Group to develop two new condominium projects worth six billion baht.

The projects, which will be launched in the third quarter of next year, include the three-billion-baht The Address on a 3.2-rai plot in Sathorn and the three-billion-baht Life Condominium on a seven-rai plot near the Ratchadaphisek subway station. The investment for the two projects would be about four billion baht, and construction would be completed in 2010 and 2011.

Two new companies will be established, AP Pacific Star (Sathorn) Co, Ltd and AP Pacific Star (Ratchada) Co. Each would have initial registered capital of 10 million baht, with AP holding 51% and Pacific Star the rest. Capital will increase to 400 million baht later.

Anuphong Asavabhokhin, AP's chief executive, said Pacific Star would help mainly in the designing process. The Address and Life projects would contain units designed to attract both foreign and Thai buyers.

The companies did not establish a joint venture due to financial reasons. AP had a debt-to-equity ratio of only 0.87 times at the end of September, but the deal was based more on mutual benefits for both sides.

''We will develop the two projects even without the joint venture. We join with Pacific Star as they have the same philosophy, especially on controlling the debt-to-equity ratio,'' said Mr Anuphong.

Asian Property will handle the management of the new projects. Prices have not been set as they depend on the final designs. Average prices for The Address brand range between four and six million baht, while the Life brand is between two to three million baht a unit.

Pritpal Singh Gill, Pacific Star's country manager, said the group was comfortable working with Asian Property due to its visionary management style that aims to offer world class products. The co-operation would bring credibility to institutional investors, he said.

Pacific Star expects to invest another US$60 million in Thailand next year. Its current accumulated investment in the country exceeds $100 million.

''We do not set a budget for investment as we are an opportunity-driven company that is open for any opportunity,'' said Mr Gill.

The company is also looking to invest in residential and hospitality developments in Phuket, Pattaya and Hua Hin.

Mr Anuphong said AP planned 10 new projects worth about 15 billion baht next year, half of which would be condominiums, including the two mentioned projects. It spent three billion baht to accumulate land this year and expected to spend another two to three billion baht on land purchases next year.

The company has a sales backlog of 16.3 billion baht.

AP shares closed yesterday on the SET at 6.90 baht, up 2.2%.

 

Source: Bangkok Post by Somporn Thapanachai
Friday November 30, 2007