BANGKOK — Meesak Chunharakchoti, former president of the Thai Real Estate Association, revealed that Chinese investors are increasingly buying land outside industrial estates in the Rayong region, such as in Nikhom Phatthana, Bo Win and Pluak Daeng districts, to set up factories to support investment in electric vehicle (EV) manufacturing in Thailand. Land prices in the industrial estates are relatively high, with some negotiations leading to discounts of up to 50 percent.
As for the real estate business, the situation remains unclear, but some investors have shown interest in partnering with local developers, possibly due to the current slowdown in the real estate market, which presents opportunities for investors.
Premsorn Sriviboonchai, Honorary Advisor to the Rayong Real Estate Trade Association, stated that Chinese investors are currently seeking to purchase land for building supply chain factories that support larger plants.
Most of the land sought is in the Nikhom Phatthana and Pluak Daeng areas, with desired land sizes ranging from 1,000 to 2,000 rai, causing land prices to double from 2 million baht per rai two years ago to 4 million baht ($117k) per rai now. In other zones, land prices are relatively high, such as in the Map Ta Phut area.
[ please note: Rai is the largest unit of land measurement in Thailand. It is commonly used for larger land areas, such as agricultural land, houses, and villas. One rai is equivalent to 1,600 square meters or approximately 0.40 acres.]
Premsorn also mentioned that land prices for housing projects have also doubled. In the Map Ta Phut area, for example, where the land is mainly forested, prices have risen from 2 million baht per rai to 4-6 million baht per rai.
Once the land is purchased, further investment is required to prepare the area, driving up project development costs. However, house prices cannot increase accordingly, which could lead to a trend of more expensive and smaller houses in Rayong in the future.
Wattana Phonchiwin, president of the Chonburi Real Estate Association, noted that the situation of Chinese capital flowing into the Chonburi region is not significantly different from previous investments in projects in the Pattaya region.
The most recent trend observed is the purchase of land outside industrial areas, especially in purple zones, for the construction of factories to support automobile production and the acquisition of businesses from closed factories rather than investing in housing.
In addition, most Chinese workers prefer to rent apartments rather than buy them, with the rental period in residential projects where owners rent out their properties usually ranging from 3 to 5 years.
Chinese investors who buy land do so under legal entities, as foreigners are not allowed to own land. Land prices in Chonburi remain stable overall as there are more sellers than buyers, giving buyers more bargaining power than in the past. However, some areas have seen an increase in prices, such as Ban Bueng and Nong Yai, where prices have risen 20-30 percent from 2-3 million baht per rai to 3-4 million baht per rai following the development of new industrial estates.
“In areas with established industrial estates, prices are rising annually, such as Laem Chabang, Phan Thong, Amata and Si Racha, where the average price is 10 million baht per rai. In Pattaya, prices range from 10 to 100 million baht per rai, depending on whether the land is near hills or the sea,” Wattana said.
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