Saraburi-based Northland Development Co is unfazed by high competition in Bangkok's condominium market and the Bank of Thailand's proposed loan-to-value (LTV) limits, using a low-price strategy to launch a condominium near Bang Wa skytrain station.
There's always room in the market for small property firms or provincial developers to enter the condo segment in Bangkok, said chief executive Noppadol Thamwiwat, though he acknowledged that competition is fierce and oversupply is a key concern.
"We use lower selling prices to tap target buyers," he said. "Purchasing power in the condo market remains healthy with rising urbanisation."
The company is also not worried about lower LTV rules -- requiring homebuyers to make a down payment of 20% of the unit price for a second mortgage residential loan or for a unit priced 10 million baht or higher -- as Northland's project targets first-jobbers.
The Beat Bangwa Interchange condo project worth 890 million baht will launch over the next two weekends. It will occupy a two-rai site on Thoet Thai Road, 580 metres from Bang Wa skytrain station.
The project will have two eight-storey towers with a total of 402 units sized at 25-51 sq m and priced at 65,000 baht per sq m, or from 1.59 million baht a unit.
The company will collect a down payment of 10% of unit price. The project targets new graduates.
"Other projects closer to the station have unit prices of around 80,000 baht per sq m," Mr Noppadol said. "The difference of 10,000-15,000 baht per sq m is meaningful for first-jobbers when it becomes a unit price. It will be 250,000-375,000 baht per unit sized at 25 sq m."
Beat will be the company's first condo project. Last year Northland had a joint venture with Bangkok-based Deva Real Estate Co to launch a high-priced six-storey duplex house project worth 240 million baht in the Ram Intra area.
Mr Noppadol, a former chairman of the Saraburi Chamber of Commerce, said the company plans to launch two new condo projects in outer Sukhumvit and in the Ratchadaphisek-Lat Phrao area worth a combined 2 billion baht in 2019.
Northland will increase registered capital from 50 million baht to 100 million baht in the third quarter next year and 200 million baht in 2020 and plans to raise funds in the stock market by 2021 with Capital Link Advisory Co as financial adviser.
During the past few years, Northland recorded about 300 million baht in annual revenue. It expects 15% revenue growth this year.
The company has developed 19 single-house projects with about 2,000 units worth a combined 5 billion baht in Saraburi under the Tara Fah Sai brand during the past 22 years. Inventory worth 1 billion baht remains for sale.