SET-listed Singha Estate Plc, a property development arm under the Boonrawd Brewery Group, will spend 85 billion baht in 2019-23 to develop residential and commercial projects, acquire hotels and offices, and invest in new businesses.
Chief executive Naris Cheyklin said about 20 billion baht will be spent next year, comprising 5 billion baht in new land purchases for development of residential projects in the luxury segment.
The rest will be for acquisition of office towers and hotels in Thailand and overseas, with a target yield of at least 8% and a minimum internal rate of return of 14%.
In 2019, Singha Estate plans to start construction of a new office tower on a leasehold seven-rai plot on Vibhavadi Rangsit Road, named Oasis, with an investment of 3.7 billion baht. The 36-storey tower with a lettable area of 53,000 square metres is scheduled to be completed by 2022.
"Our new investment plan is as aggressive as our plan four years ago," he said.
"This time we will use money gained from selling one of our office towers to a real estate investment trust [REIT]."
Next Monday the company plans to launch its first REIT, S Prime Growth Leasehold Real Estate Investment Trust (SPRIME), which will invest in Suntowers, comprising two office towers with a total lettable area of 62,850 sq m. Singha Estate spent 4.5 billion baht in 2015 to buy the towers.
"The REIT will make us recycle the investment without disturbing shareholders," Mr Naris said.
After establishment of the REIT, the company expects its debt-to-equity ratio will reduce to 1.2 times from 1.5 times.
A part of the 2019 investment budget is to come from 20 billion baht in revenue Singha Estate expects next year. A majority will be from the transfer of units at three luxury condo projects.
They comprise the 4.9-billion-baht Esse Asoke, 4.3-billion Esse at Singha Complex, and Banyan Tree Residences, which is developed by a subsidiary, Nirvana Daii Plc, with a sales value of 6.5 billion.
Revenue next year will also come from the transfer of units at a super-luxury single detached house project, Santiburi the Residences, and recurring income from two office towers: The Lighthouse on Charoen Nakhon Road and Singha Complex on Asok Road.
The company will gain income from the hotel business, with 39 sites in Thailand and overseas.
In 2019, two new hotels are planned at Crossroads, the multi-island integrated resort project on the Maldives it developed a few years ago.
The hotels are SAii Lagoon Maldives Curio Collection by Hilton with 198 rooms, beach villas and overwater villas, and Hard Rock Hotel Maldives with 178 rooms.
"With know-how and expertise in the hotel business, next year we will provide a turnkey development solution for landlords or investors in the hotel," he said.
S shares closed unchanged on Wednesday on the SET at 3.10 baht in trade worth 12.7 million baht.