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Japanese expats attract more developers

Jul 20, 2017 | Emerging Trends, Expats

The largest group of expatriates in Thailand is the Japanese and their numbers are thought to be in the region of 36,000. Bangkok is not surprisingly the most populace area, accounting for approximately half of this number however the second city for Japanese expats in Sri Racha.

The Eastern Seaboard is where a vast number of industrial businesses are based which in turn creates jobs for both white and blue-collar workers. Many of these jobs are taken by Japanese nationals who choose Sri Racha as their home as opposed to Pattaya, an area favoured more by Westerners although still within easy travelling distance.

Sri Racha has a large Japanese community that is comparable in many ways with that in the Sukhumvit-Thonglor are of Bangkok. There are plenty of Japanese style supermarkets, shopping centres such as J-Park and AEON, as well as a selection of Japanese restaurants. There is of course a Thai-Japanese Association School to cater for families with children.
Whereas many expats prefer to live in houses or condominiums, the Japanese expat tends to favour serviced apartments and hotel like living. This has been attributed to the fact that most Japanese stay in the Kingdom for a period of five years of less and don’t want to be burdened by doing household chores after a long day at work.

 

The attraction of this ‘hotel like living’ has not gone unnoticed by developers who are now building more serviced apartments and hotels for long stay residents. This type of accommodation is now more profitable than condominiums as well as realising returns faster. This naturally encourages investors looking to gain returns through rental yields and there are now several partnerships between major developers and 5-star hotels offering investor the opportunity to purchase units in hotels in what is known as a rental guarantee concept.

Although many of these rental guarantee concepts are currently offered in tourist hotspots such as Pattaya, Phuket and Samui, the likelihood is that this will spread to other parts of the country over time. If we look at Sri Racha for instance, most of the expats live within a two-kilometre radius of the Robinson shopping centre. Most of these expats rely on shuttle services offered by either their places of work or their residence in order to get around – something not offered by most condominiums.

As you would expect, the serviced apartments and the other hotel like accommodation offer a full range of facilities like traditional Japanese breakfast packages, laundry services, washing machines, cooking and dining equipment, ofuro/jacuzzi, or a bathtub in each room. Obviously, as demand increases developers respond by building better quality accommodation meaning that many older properties are no longer desirable. As a result, developers are now renovating these older building in order that they can compete with the newer properties.

Sri Racha may not be as large a market as Bangkok but it has a consistent pipeline of new residents with 1,300 hotel units and serviced apartments currently under construction. Branded management companies such as Ascott are also looking to build new properties, something that in turn may attract the larger hotel chains to follow suit, offering rental guarantee concepts to investors.

One thing is for certain, with the continued heavy government investment in the area, there will be increased investment opportunities in the residential sector. Demand is already high and the supply will inevitably grow to meet this demand. In Sri Racha, like many other areas of Thailand, there are lots of opportunities to generate exciting returns via investment properties.

Whereas many expats prefer to live in houses or condominiums, the Japanese expat tends to favour serviced apartments and hotel like living. This has been attributed to the fact that most Japanese stay in the Kingdom for a period of five years of less and don’t want to be burdened by doing household chores after a long day at work.

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