Bangkok--29 Jun--MT Multimedia
'B&G Park’ shows potential as developer of premium office buildings
Ready to set fund-raising target for Q3/2020 following approval of BGREIT
Full confidence in office space rental market after COVID-19 remission
“B&G Park Company Limited”, the developer of commercial real estate projects flaunts its great potentials with the Interchange 21 premium office building project in the 'super prime business area’. The Company declared the policy to expand its real estate business while promoting brand image in a bid to become an ASEAN leader in office building and hotel real estate development. The target is set to raise fund in Q3/2020 following the Security Exchange Commission (SEC)’s approval of the filing to set up BGREIT. The Company is confident that the demand for office buildings will continue to grow despite the changing work behavior and in choosing the size of rental spaces due to the COVID-19 pandemic.
Mr. Theprit Srichawla, Director, B&G Park Company Limited (B&G), revealed that the Company is an expert in commercial real estate development branching into two main groups, namely, tourism and hotels both domestically and abroad, such as Avani Hua Hin Resort & Villas; and office buildings such as Interchange 21 Building. The Company is the developer and manager of the office building and retail shops in this Grade A super prime business area in the heart of the Asoke-Sukhumvit CBD where these two main roads meet and intersected by the BTS Asoke Station and MRT Sukhumvit Station. Moreover, it is situated near shopping centers, hotels, and leading restaurants in the Asoke and Sukhumvit areas with convenient access to several other nearby amenities.
The Director of B&G Park Co., Ltd. further added that the trend of the office building for rent market after the remission of COVID-19 infection could change as some businesses may reduce their business investment but the demand for office space rental will remain albeit in a differing format. This may be in the form of reduced floor area to suit the work-from-home behavioral trend. Many business operators have adapted themselves to cope with the situation by applying more technology to provide additional convenience for the employees to reduce the need for them to come to the office. Therefore, the need for office space will be reduced and the seating areas may need to be adjusted to accommodate those who still need to be in the office. However, the Company has been well prepared and has made adjustments prior to the crisis through the strategy to manage the office rental space, and to have close and regular communication with the tenants. In addition, the Company has concluded that to reset rental prices to compete with other operators of office buildings for rent is not a proper strategy in the present environment. The more ideal solution would be to provide convenience and services that will support the tenants’ operations, such as the renovation of the common areas and the modernization of the building’s systems to fulfill the needs of the tenants to attract them to remain and eventually renew the contracts.
“During this period, the Company adopted an active measure to help the tenants by arranging office areas to suit the customers’ needs. Therefore, the building had a variety of businesses that were small tenants, while the Company helped the tenants who were affected by the imposition of the Emergency Decree by waiving the rental fees. For businesses that were partially affected, and the operations could proceed on a smaller scale, the Company has reduced the rental fees on a case-by-case basis to provide flexibility that would allow the tenants to carry on with their businesses. These support measures are expected to end soon. Therefore, this situation will not significantly impact the tenants in their ability to rent the office spaces and we are confident that this will not affect the investment of the BGREIT that will occur in the near future,” Mr. Theprit added.
Lately, the Company has proceeded to set up the trust fund to raise capital in the Interchange 21 project. At present, the Security Exchange Commission (SEC) has started its consideration of the Initial Public Offering (IPO) proposal and the filing of B&G Leasehold Real Estate Investment Trust (BGREIT). The B&G REIT Management Co., Ltd., a B&G subsidiary, will manage the trust fund while Siam Commercial Bank Plc. will be the financial advisor. BGREIT will initially invest in the Interchange 21 project for a period of approximately 25 years with the registered capital of not more than 8,043 million baht consisting of 6,543 million baht in raised fund and 1,500 million baht in long-term loan. The Company is expected to be approved for listing on the Stock Exchange of Thailand (SET) within the third quarter of 2020.
“Our policy is to invest in assets consisting of real estate in the form of Grade A office building with areas for rent as offices and retail spaces in a location with high growth potential, or the invest additionally in other types of real estate assets to promote the B&G brand as a leader in office building and hotel real estate development,” Mr. Theprit concluded.