D'Well builds low-rise to avoid condo risk

The three- and four-storey single detached houses at Arna Ekamai on Sukhumvit Soi 65 are priced at 32-55 million baht each.

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Small property developer D'Well Grand Asset Co is diversifying into the low-rise market, planning to launch four small-scale housing projects in Bangkok worth a combined 1 billion baht to avoid oversupply risk in the condo segment.

Managing director Thavanan Tanesdechsundhara said the company began readying the land plots for the four new projects last year after sensing an oversupply in the condo market.

"It's a good time for us to prepare to develop the low-rise market," Mr Thavanan said. "Small developers should not over-invest and should focus on what they have expertise in."

The four new projects will include three townhouse sites under the Aires brand in Rama IX, Ratchadaphisek Soi 19 and Ramkhamhaeng. Each will be located on a two-rai plot with 18, five and 12 units respectively.

Unit size will range from a plot sized 25-40 square wah with 3.5- to 4.5-storey townhouses and a usable area of 250 sq metre each. Prices will range from 13 million to 25 million baht a unit, tapping expanding families in each location.

These three projects, worth a combined 800 million baht, will be joint ventures with Sethiwan Group, a large landlord in the Sukhumvit area, which holds a 40% stake in each project. The rest is owned by D'Well.

Other projects will include semi-detached houses on Bang Na-Trat KM 7 Road near Megabangna, located on a one-rai site with seven five-storey units and 500 sq m of usable area, priced from 30 million baht.

"We are diversifying to many locations with small-scale projects and aim to spend less than two years to complete development," Mr Thavanan said.

Founded in 2011 with registered capital of 120 million baht, D'Well developed a total of four projects worth a combined 2 billion baht. All were condominiums in Sukhumvit Soi 65, Thong Lo, Phahon Yothin Soi 8 and the Phahon-Kaset area, and all sold out.

In 2017, the company launched Arna Ekamai, a luxury single detached house project, on a nearly two-rai plot of Sukhumvit Soi 65 with 11 units priced at 32-55 million baht. Seven units have sold so far.

D'Well expects to have 600 million baht in revenue by the end of 2019, up from 500 million baht last year, and aims to have projects worth a total of 1 billion baht on hand annually.

"The property market this year is not so difficult for small-sized developers that have a good plan," Mr Thavanan said. "The market is positive because everything is screened for developers, like self-screening customers. Banks also help screen both customers and projects."

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