Property consultancy JLL eases worries about oversupply.
Despite concerns over potential oversupply in Thailand’s office sector, particularly in Bangkok, property experts believe demand remains robust enough to absorb new developments coming into the market.
Global property consultancy JLL Thailand dismissed worries about office oversupply in Bangkok, citing strong demand dynamics that continue to absorb new developments.
Multinational companies are increasingly attracted to Thailand’s competitive rents and expanding Grade A market, which now competes favourably with regional peers. The country’s status as a premier tourist destination with favourable living conditions also enhances its appeal for expatriates.
Key market trends for 2025
JLL Thailand’s comprehensive market overview identifies four key trends that will shape the nation’s property landscape in 2025, with particular focus on Thailand’s growing prominence as a beneficiary of the “China+1” strategy.
Allan also highlighted promising investment sentiment data: “The investment volumes in Asia Pacific are projected to grow by 23% in 2024, significantly outpacing Europe, Middle East and Africa at 17% and the Americas at 10%. In particular, the office sector has seen a resurgence, with volumes increasing by 12%.”
What’s driving demand for premium space
A reversal of hybrid working trends is fuelling demand for high-quality office spaces, with companies increasingly requiring staff to return to physical workplaces.
“We are observing a shift away from hybrid working, with major organisations requiring employees to be in the office an average of three to four days per week. This has fuelled demand for prime office spaces, particularly within mixed-use developments offering comprehensive amenities,” Glancy explained. “Businesses that previously downsized are now seeking additional space to accommodate returning staff, driving expansion across the market. With office quality now a significant factor in job selection, landlords and occupiers investing in upgrades will be best placed to capitalise on this demand.”
In the Central Business Area, Grade A+ office spaces have recorded a five-year compounded annual growth rate of 3.7%, significantly outpacing the market-wide rental growth rate of 1.0%.
Asset enhancement becoming critical
Landlords are increasingly focused on portfolio upgrades to maintain competitiveness and tenant retention. As of 2024, only 30% of Bangkok’s existing office stock held LEED, WELL, and WiredScore certifications, presenting a significant opportunity for enhancement.
The sustainability premium is becoming increasingly apparent, with green-accredited buildings commanding up to 14% higher rental prices in Bangkok.
Hospitality sector transformation
Thailand’s hospitality sector is experiencing a renaissance, with significant investment and evolving traveller preferences driving growth.
“While hotel performance is expected to continue growing, we anticipate a more moderate pace compared to the exceptional recovery of the past two years. We also foresee strong growth in MICE and wedding-related events,” commented Rathawat Kuvijitrsuwan, senior vice president of advisory and Asset Management, Asia, JLL Hotels & Hospitality Group.
Hotel transaction volumes are projected to reach 13 billion baht in 2025, surpassing the country’s 10-year average and reflecting Thailand’s enduring appeal as an investment destination.
Investment hub potential
The report underscores Thailand’s growing position as a regional investment hub, particularly in high-tech sectors such as electronics and semiconductors. Investment in digital industries has surged from 10 billion baht in 2023 to 243 billion baht in 2024, while data centre capacity is projected to grow by 300% by 2030.
Credit : https://www.nationthailand.com/business/property/40046821