The 25-storey building now under construction will offer 52,000 square metres of flexible office space and common open spaces to foster creation, innovation and collaboration.

The concept would be ideal for corporates, multinational corporations, tech SMEs and startups that need open-plan workspaces to boost interaction.

“We are extremely excited about our new corporate headquarters, our first Grade A office development project that will be strategically located along Debaratna Road,” said Jareeporn Jarukornsakul, chairman and Group CEO.

“WHA Group is looking forward to partnering with leading international property-services firm JLL as the sole leasing agent for this project. We will soon begin offering office space to dynamic companies looking for a flexible working environment in a modern building.

“We are incorporating special features such as sports areas, co-working space, artisan cafe and other activities. Our intention is to offer corporate users a better work and living experience where people can combine work with a healthy and fun-loving lifestyle.”

Approximately 35 per cent of WHA Tower will be occupied by WHA Group offices, with the remaining area to be offered for lease primarily to WHA customers and corporations or business entrepreneurs in the new-generation industries.

The location is close to Central Bangkok and a short drive to the EEC. It is also close to Suvarnabhumi Airport, Mega Bangna, Central Bangna and residential projects.

Designed for maximum efficiency, the building will allow tenants and visitors to reach the most convenient routes at all times.

“We are negotiating with a Myanmar partner to set up a joint venture firm to develop mixed-used projects. It could be finalised this year or next year, depending on the conditions. We are also looking at possibilities in Vietnam. We believe that within five years we will be developing mixed-use projects in both countries,” he said.

He added that the company has continued to expand investments in the hospitality business in both Thailand and overseas after deciding to separate its hotel business, S Hotel & Resorts Plc, to manage all of its hotel business units. The company has already applied to the Securities and Exchange Commission for listing S Hotel & Resorts Plc on the Stock Exchange of Thailand. It will raise new capital through the issue of 1,437.45 million shares with par value at Bt5 per share.

“We plan to use the funds from the initial public offering to expand our hotel investment. As of now, we have a total of 39 hotels with a combined 4,647 rooms in Thailand, UK, Maldives, New Zealand, Fiji, Mauritius, Samoa, Indonesia, US, and Australia, under the brands Outrigger, and Crossroad. We expect to have 100 hotels around the global with 10,000 rooms by 2024,” he said.

“We cannot say how much will be invested in the hotel business from 2020 to 2024 but on average the investment per room will be US$700,000,” the company’s chief financial officer Thitima Rungkwansiriroj added.

With aggressive investments in the hotel business, the company expects total revenue from hotels will comprise up to 40 per cent of Singha Estate Plc’s total revenue target of Bt20 billion in 2020, he said.

At the end of year 2018, S Hotel and Resorts Plc recorded total revenue of Bt2.5 billion and net profit of Bt450 million.

The company also plans to launch the hotel of the group as a real estate investment trust to raise capital for business expansion, he said. Meanwhile, this year, the company has set aside an investment budget of Bt10 billion for investment in hospitality, office, and residential projects this year.

Up to Bt7 billion of the total Bt10 billion investment budget has already been spent in the first half of this year. The balance Bt3 billion will be invested during the rest of the year with plans to launch its condominium project worth Bt4.5 billion at Lang Suan, Bangkok. The project will be launched in the market in the third quarter of this year.

“If the investment budget exceeds Bt3 billion this year, we also have an extra investment budget of up to Bt7 billion. This will depend on the business opportunity,” he said.

Naris said that this year, its total revenue from residential projects would account for about 70 per cent of total revenue when the residential projects are transferred to customers this year.

The company currently has total backlog of Bt12 billion; nearly Bt6 billion of the total will be booked as total revenue this year, and the rest will booked as revenue next year.

As the company also has inventory for sale worth up to Bt15 billion, they will generate revenue during the rest of this year and the next two years from now, he said.

The company has also invested Bt3.7 billion since early this year to develop its new 50,000-square-metre office building, Oasis, on Vibhawadee-Rangsit Road. This will increase its office building space from 120,000 square metres to 170,000 square metres in 2020. This will be a part of its strategy to generate recurring income for the group in 2020.

“In 2020, up to 50 per cent of our total revenue will come from recurring income from the both hotels and office buildings, and the balance 50 per cent from sale of residential projects,” Naris said.

In the first quarter of 2019, Singha Estate Plc recorded total revenue of Bt3.15 billion and net profit of Bt268.98 million, up 160 per cent and 13 per cent respectively from the same period of last year. The company also expects its total revenue growth in double digits this year compared with last year. At the end of 2018, the company reported total revenue of Bt8.93 billion and net profit of Bt1.28 billion.

As new small and medium-sized enterprises and startups focus on the sharing economy, property firms are also taking notice.

Sansiri Plc and Siam Commercial Bank, for example, in 2017 established Siri Ventures Co Ltd to expand investment in startup businesses in order to develop technology to serve the property industry.

Since then, Siri Ventures Co Ltd has invested Bt900 million in startup businesses in Thailand and overseas as part of its three-year plan to invest Bt1.5 billion between 2017 and 2020.

The firm also set up the Siri Ventures Private PropTech Sandbox in order to provide various aids, including mentorship and insight from various business units, grants, lab rooms, networking opportunities and smart devices. It will also provide a co-working space to support startups in the areas of proptech, living tech, contech, health and wellness tech and sustainability in this year.

Ananda Development Plc also expanded its investment in startups by announcing it sees itself as an urbantech company under its strategy to deliver urban living solutions to customers.

For its part, Origin Property Plc set up Primo Service Solution Co Ltd, an arm for investment and collaboration with startups, as the company develops its “digital butler service” and others applications, along with artificial intelligence, to betters serve its customers. It also aims to provide the service to other property firms.

SC Asset Corporation has established a new investment arm for startups and technology. Called SC Urban Co Ltd, it has invested in Fixzy Co, a startup firm that provides home renovation and repair services through the “Fixzy” application.

Meanwhile, the new business model can combine services and application technologies developed by startups as an entry point to providing sharing services to the market.

Take, for example, Hostmaker, an award-winning home rentals management company from Europe. It has already entered the market in Thailand.

“We established our business in Thailand in November 2018, and have grown to managing 120 condominium units in Bangkok, such as along Sukhumvit, Phya Thai, Ratchathewi and Mo Chit. They are open for rentals start from under 30 days through to six months, depending on the customer demand,” Hostmaker Thailand’s assistant general manager, Paruethai Panjaboon, said in a recent interview with The Nation.

Paruethai said the business had enjoyed success in Europe and others countries by following the behaviour change of homeowners as they shifted to sharing their assets and using their assets to create income for their families.

Co-working space is another aspect of the new business model based on serving the sharing economy. The sector was first established in the US and Europe and has now firmly entered Thailand to positive feedback from the market. Globally, co-working spaces have been growing rapidly, surging from just 75 spaces in 2007 to more than 7,800 in 2015, according to a CBRE report.

According to the World Economic Forum, freelancers – which are often users of co-working spaces – now account for 35 per cent of the total workforce in the United States and 16 per cent in Europe – and their numbers are growing in Asia.

According to Colliers, the first co-working office in Thailand emerged in 2012, pioneered by local operator Hubba in the Ekkamai area. The number of co-working space projects nationwide rose from four in 2012 to 12, 20, 60, 120 and 132 from 2013-2017 respectively, and is projected to reach 150 by the end of this year. Another 25,000 square metres of new space from 10 projects will be added in Bangkok this year, boosting the total to 125,000 sq m.

However, that would still account for only 1-2 per cent of total office supply, which is estimated at 8.8 million square metres, the research said.

“Customers behaviour in the market has already changed to renting residential rather than buying residential for themselves,” LPN Development Plc’s chief executive officer and managing director, Opas Sripayak, said in a recent interview with The Nation. “This inspired our business to move to developing residential for renters in order to serve customers’ demand.”

He added that the trend of the young generation is to choose a sharing-oriented lifestyle rather than owning all assets including an office, car and residence. Most of this generation to not want to be the sole owner of a residence, and the next step for property firms will be to respond to this choice with a business model based on developing rental apartments and serviced apartments.

“We do not develop serviced apartment or rental residential at this time, but we are studying it and may do so the next time we see that opportunity,” Opas said.

However, the company is currently developed offices for rent at Vibhawadee Rangsit as part of its mixed-use project, that includes condominium, retail and office space, he said.

In this year the company will increase its recurring income to 15 per cent of total revenue, up from last year’s 2 per cent, by focusing on rental offices and its service business, Opas said.

Vasin Mahaphon, 37, bought townhouse at Ekkamai Soi 28 and renovated the residences with the intention to sell, but when the renovations were complete he found most customers wanted to rent rather than buy the homes.

“One of our customers paid rental averaging Bt40,000 a month with the rental fees for two years paid in advance. I even asked them why they did not buy because they had more than enough money to. They told me that they do not want to be the owner of a residence, because if [they rent] it will be easier for them to move when they change their job,” Vasin explained.

Responding to the market trend, most property firms are launching their new business model which focuses on recurring income to match customer demand.

For example, Origin Property Plc has established One Origin Co Ltd to manage and expand its recurring income to ensure sustainable growth. The new company, formed this year, has set a Bt12-billion budget for a slew of new projects, including Staybridge Suites in Thonglor, Holiday Inn & Suites at Sriracha Laemchabang in Chon Buri province, Staybridge Suites in Sriracha, Chon Buri province, One Origin hotel on Sukhumvit 24 and the One Origin retail complex in Phya Thai.

All new projects under One Origin Co Ltd will generate recurring income for long-term sustainable business growth, and also match the changing customer demand, Origin Property Plc’s chief executive officer, Peerapong Jaroon-ek, said recently.

Following the market trend effected not only the residential market, but also other property sectors including office buildings and hospitality businesses.

For example, office building concepts have already changed to include co-working space to serve the new market for small and medium enterprises and start-ups who do not need high-cost office rentals. Members of co-working spaces pay a cost lower than traditional office-space rentals.

Co-working spaces in Thailand made up a total 100,000 square metres combines at 2018 year-end, or about 2.6 per cent of total office space nationwide, according to reports from property agency firm Nexus Real Estate Advisor Co Ltd. Co-working space will increase to 30,000 square metres in this year, Nexus research predicts.

According to a survey by Global Co-Working Unconference Conference, the worldwide forecast for co-working space totalled 17,725 offices by 2018 year-end, up 16 per cent from 2017. Its research also forecast an increase to 30,432 co-working offices in the year 2022.

JLL Thailand’s managing director, Suphin Mechuchep, said the popularity of a co-working space could be attributed to the difference in rental costs as well as its environment, infrastructure and design.

To stay competitive, owners of office buildings need to consider include a shared working space in their properties for individual users, she said.

For retail complexes, a co-working space could boost traffic to the venues amid the challenge of e-commerce. Suphin said the mix of users has now widened to employees of large corporations wanting their staff to learn and share ideas in a broader community.

“A co-working space should be easy to access, come with good infrastructure and an appealing design, and provide both public and private areas,” she said.

Meanwhile, hospitality business are also experiencing the impact of the public demand for Airbnb, an online marketplace connecting people who want to rent out their homes to people who are looking for accommodations in that locale.

It currently covers more than 81,000 cities and 191 countries worldwide. The company’s name comes from a play on “air mattress B&B”.

According to research by the SCB Economic Intelligence Centre (EIC), Airbnb’s worldwide exponential growth is squeezing hospitality sector revenues, particularly among hotels in the middle-to-low price range.

Since its launch in 2010, Airbnb rooms have increased at the rate of 150 per cent yearly. It now offers more than 2 million rooms, compared to the 1.5 million of the Marriott group – the world’s largest hotel operator.

The research shows that hotel rates in Thailand are relatively low compared to other countries and cost about the same as Airbnb rooms. As a result, travellers are likely to choose the traditional option and Airbnb is not likely to hit Thailand’s hospitality sector in Thailand as hard as in some other countries.

However, more than one million Chinese tourists are booking rooms through the Airbnb website, and its room availability in Bangkok is expanding by more than 100 per cent. Chinese consumers are open to innovation, including a sharing economy. Data from China’s Information Centre indicates that more than 500 million Chinese consumers have used sharing economy services.

In 2015, Airbnb teamed up with Union Pay and Alipay as part of its aggressive push into the Chinese market, resulting in a dramatic 500 per cent uptick in users. Since Chinese travellers make up 27 per cent of the Thai tourism market, Airbnb won’t have much difficulty increasing its market share in Thailand.

Moreover, Airbnb continues to expand in Thailand, with around 9,000 rooms in Bangkok this year compared to around 4,000 last year. Airbnb also offers what comparable hotels cannot, for example larger rooms with a kitchen at a similar price to a standard hotel room.

Hotel operators should get ready for increased future competition from Airbnb. Other service businesses can also benefit from Airbnb’s growth. EIC recommends that hotels not compete on price. Rather, they should upgrade their services and sell customers on the added convenience and services they would enjoy from staying in a hotel. It is worth noting that Airbnb customers are usually on the lookout for new experiences, rather than just a place to sleep.

As well, business owners in the service industry can utilise their existing resources to provide services to Airbnb room owners, such as housekeeping, key deposit or reception service in a coffee shop. All of these are in high demand among Airbnb room owners.

With the global and local market trend moving toward sharing businesses and a sharing economy, all property developer firms – both residential and commercial – are under unavoidable pressure to revise their business models to match the market demand.

“We believed the market will recover in the second half of this year,” he said.

Currently, the company has a total backlog of Bt12 billion that it will transfer to its customers in this year and next year.

The company also plans to launch a new condominium project at Soi Rang Nam in the second half of this year and its two hotels will also open.