Park Ventures Ecoplex achieves record office rental rates

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Park Ventures Ecoplex, a grade A office and retail development, has achieved the highest rental rate in the Bangkok office market at THB 875 baht per square metre per month, thus adjusting the new asking rental to THB 900 baht per square metre since 1 June 2012, according to Nithipat Tongpun, Executive Director and Head of Office Services at CBRE Thailand.

Currently, more than 70% of the office spaces at Park Ventures Ecoplex have been leased out.  The tenant mix is a combination of leading and well-known multinational companies such as Club21 Thailand, CIMB Securities, Servcorp, and Tractebel.

Park Ventures Ecoplex in Bangkok. Park Ventures Ecoplex in Bangkok.

One of the key factors driving its success is the strategic location.  The building is situated right in the heart of Bangkok’s central business district (CBD) at the corner of Ploenchit and Wireless roads, in close proximity to 5-star hotels including the Okura Prestige Bangkok Hotel which is in the same compound, as well as embassies, leading shopping malls, and other business areas.

With a direct skywalk access to the Ploenchit BTS station, tenants and visitors have very easy access to the property.  Other factors underpinning the project’s success include the high-quality specifications, its functional floor plate with a column-free design, and high ceilings.

Being equipped with high technology and innovative energy-saving systems also add to its score as a ‘green’ building, a factor which is increasingly taken into account by tenants when leasing an office space.

According to CBRE Research, in Q1 2012, grade A CBD rents rose to an average of THB 713 per sq.m. per month from THB 702 per sq.m. per month in Q4 2011.  The highest rents are in new grade A buildings in the CBD.  Average rents for grade A office space in the CBD rose by 1.6% Q-o-Q and by 4.9% Y-o-Y.  The achieved rent at Park Ventures Ecoplex currently exceeds the market average by at least 20%.

The total office supply in Bangkok increased to 8.14 million sq.m., a 0.3% increase Q-o-Q and  2% Y-o-Y.  The supply grew by approximately 32,000 sq.m.  However, there was no new supply of grade A offices in CBD locations; therefore, rents and occupancy rates at grade A CBD offices are well positioned for further growth.  The net new take-up of office space in Bangkok was around 35,000 sq.m.  The overall occupancy rate improved slightly to 86.1 % in Q1 2012 from 85.9% in the previous quarter.

Mr. Nithipat reports that “the office market continues to improve steadily, with an increase in the net-take up and higher occupancy rate.  Providing there is no major external economic shock or domestic political event, the outlook for the Bangkok office market is positive.

“There is very little new space being completed in Bangkok this year,” he added.  “If tenants want to upgrade or expand, there is limited choice, especially for tenants requiring large spaces.  Rents are rising in the highest quality and best located buildings.  Therefore, it is strongly recommended that tenants plan well ahead in advance of lease expiry dates.”