Despite the ongoing political turmoil in Thailand, demand for office space in Bangkok has continued to pick up so far this year, according to a new market report from real estate firm Jones Lang LaSalle. There has been 65,000 square meters of office space being taken in the first half of 2008, which is an 80% increase from the second half of 2007. Jones Lang LaSalle expects the amount of office space taken or occupied to be well higher than for 2007.
2006 was a banner year for office rentals in Bangkok, with 200,900 square meters of space being taken up and 304,000 square meters constructed. 2007 saw a major dive in office rentals and construction with only 102,200 square meters of space taken up and a paltry 94,000 square meters completed, and 2008 is looking to be much better than last year.
While the market is seeing demand rise, there is actually an oversupply of space available in the Thai capital. Mr. Dan Tantisunthorn, Head of Research of Jones Lang LaSalle, said “Whilst the net take-up level in 2008 is likely to exceed 150,000 sqm, the Bangkok office market will see 252,000 sqm of new supply by the year end, with 89,000 sqm already completed in the first six months of the year. This will put some more downward pressure on rentals.”
With supply still outpacing demand, the cost of good office space in Bangkok should stay relatively low for at least a little while to come.
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