The rating downgrade reflects the fact that CI has a smaller scale of business than its rated peers, as well as the company’s “volatile and declining operating performance and its increasing leverage”, TRIS said.

The rating continues to reflect its brand recognition in the middle- to high-end condominium and hotel segments. It also reflects recurring rental income the company earns from the commercial office space it owns, and the dividends received from investments in Sri Panwa Hospitality Real Estate Investment Trust (SRIPANWA) and Bangkok Commercial Property Fund (BKKCP).

Lastly, TRIS said the rating takes into consideration the cyclical and highly competitive nature of the real estate development industry.

With 2.1 million square metres of office space, co-working spaces have boomed.

In line with a global trend, co-working spaces in Thailand have grown by 35 per cent over 2-3 years and foreign chains have started penetrating the Silom-Sathorn area to tap demand from office workers, startups, freelancers and expatriates.

Meanwhile, space in the residential market has been limited for new projects development.

This has resulted in attractive returns of 4-5 per cent per annum for both the resale and rental markets, managing director Anukul Ratpitaksanti said on Monday.

The revenue will derive from existing residential projects being transferred to customers this year from a total backlog worth Bt6 billion being transferred through 2020, he said.

At the end of 2017, the company reported total revenue of Bt725.44 billion, down 28 per cent from 2016, and a net loss of Bt278.91 million.

Condo projects make up Bt4.14 billion of total presale, with the rest of the Bt8.83 billion coming from single detached house and townhouse projects worth Bt4.69 billion.

This is thanks to the demand for residential market growth in the first quarter of this year, said Tritecha. The company also expected the market would continue to grow in the second quarter of this year, he said.

 Bangkok ranks as the third most popular city for Chinese entities expanding their investments in the

property sector in terms of corporate leasing activity over the past three years, an industry expert said.

Nexus Property Marketing managing director Nalinrat Chareonsuphong said that in the first quarter foreign investors increased their investments in Bangkok’s condominium sector. Large Chinese companies that did not invest in joint ventures with Thai developers accounted for around 20 per cent of the condominium units launched in the city for the three months – at projects worth a combined Bt30 billion-plus.

The brisk activity in the market is seen as reflecting foreign investors’ increased confidence in Thailand.

Despite foreigners investors already being very active in the Thai market – along with in Japan, Hong Kong and Singapore – they are looking for opportunities to add to their investments in the Kingdom.

“We have started to see more condominium projects that target Japanese people in Thailand as well. And we expect to see at least four to five large-scale projects from Japanese developers this year,” Nalinrat said.

In the first quarter of the year, some 14,094 condominium units were launched in the Bangkok market – by both large and small developers. The new supply corresponds to an earlier projection, resulting in a total of 564,000 units.

Due to the rising land prices in the heart of Bangkok, it has been very challenging for the developers to retain the land for new developments, Nalinrat said. This has resulted in most projects being located farther out from the centre, with the Sukhumvit zone accounting for 29 per cent, the Phayathai-Ratchadapisek-Rama 9 zone with 23 per cent and Thaksin-Petchkasem, 17 per cent.

In the second half of 2018, the company expects to see more projects launched in the Chaeng Wattana and Ram-Indra areas due to a clearer view on the plans for the Pink Line mass rapid transit route.

“We also will see more projects of super-luxury condominiums with a starting price of Bt400,000 per square meter by the end of this year or early next year, as a result of the higher land price,” Nalinrat said.

“Meanwhile, the market for city condominiums will keep expanding into the areas served by the extensions of the rapid mass transit lines, but the prices in this market will not increase by much.”

Meanwhile, JLL yesterday announced the finding of its latest survey in the series “China12: China’s Cities Go Global”. Bangkok was found to be the 10th most popular destination for mainland Chinese firms expanding overseas, and ranks third in terms of volume for Chinese corporate leasing activity over the past three years.

The report analyses 12 Chinese cities and their transformation into major hubs of innovation and global interaction. It also delves into the country’s emerging wave of influential corporates and the impact that this group of dynamic Chinese companies has beyond the domestic market.

“The China12 are home to a growing group of highly dynamic and ambitious new-generation firms that will drive the next wave of globalisation,” said Jeremy Kelly, director of global research at JLL. “We’re already seeing a higher number of domestic brands – both established firms and startups – enter the international market, with key targets in South and Southeast Asia.”

Among the global network of cities, Asian markets such as Singapore, Tokyo, Jakarta, Bangkok, Seoul and Delhi are featured prominently. Leading the pack is Singapore as the top destination for mainland Chinese firms expanding overseas.

“Not only is it Asia’s most stable and transparent market and a global financial services hub, Singapore also carries strong links to China and is geographically well-placed to act as a gateway into Southeast Asia,” the JLL report says.

Two of the world’s most globalised cities – Tokyo and Seoul – come in at a close second and in fifth place, respectively, demonstrating China’s appetite for the world’s leading gateways and financial centres.

Jakarta, ranked sixth, and Bangkok at 10th are major beneficiaries of Chinese companies’ expansions into Southeast Asia. Delhi, in 13th place, is also noted as a key target as Chinese corporates seek to tap into India’s vast population of over a billion people, the report notes.

Large-sized developers seek investment opportunities in the property leasing market to manage their cost more effectively and generate long-term revenue.

The market for luxury homes in central Bangkok would continue to grow in the second half of this year, managing director Nalinrat Chareonsuphong forecast.

During the first quarter of 2018, 14,094 condominiums had become available in Bangkok from both large and small developers, Nalinrat said.

In the first quarter, around 20 per cent of condominiums in Bangkok were developed by large Chinese companies without investing as joint ventures with Thai developers. The combined value of these projects was over Bt30 billion, she said.