A mammoth development is under way on prime real estate across from Lumpini Park in central Bangkok, led by conglomerate TCC Group. One Bangkok will be among the biggest private-sector projects in the country at 120 billion baht.

The site spanning around 167,000 sq. meters will be home to five office towers, residential high-rises, retail space and a concert hall, as well as a Ritz-Carlton hotel, according to plans.

TCC’s business spans Chang beer brewer Thai Beverage and real estate. The project will serve as the “keystone” that brings world-class businesspeople, investors and tourists from all over the world to Bangkok, said Panote Sirivadhanabhakdi, group CEO of Frasers Property, the company overseeing the project, and the second son of Charoen Sirivadhanabhakdi, founder of TCC. Construction was delayed by the COVID-19 pandemic, but the first phase of the venture’s opening is slated for March 2024.

A nearby food vendor has high hopes: “The more foot traffic there is, the better for business.”

Top Thai conglomerate Charoen Pokphand Group is working on a mega-project of its own in Samut Prakan just outside Bangkok with an emphasis on sustainability. The Forestias will consist of retail spaces, a hotel and residential areas. The operator of the 125 billion baht, wellness-oriented venture has enlisted Japan’s Sumitomo Mitsui Trust Bank as an investor.

Over large-scale 20 projects with scheduled openings by 2027 are planned in Bangkok, with their planned investments totaling 500 billion baht, according to disclosed data compiled by Nikkei.

Massive developments of an unprecedented scale are on the rise, and these could become future Bangkok “landmarks,” said Roongrat Veeraparkkaroon, managing director at real estate service firm CBRE Thailand.

Helping drive the rush of supersize projects in Bangkok is the development of the BTS Skytrain mass transit system, which inspired cash-rich corporate groups and real estate developers to look for sites beyond the restaurant- and shop-lined Sukhumvit Road to other neighborhoods and even suburbs.

Retail giant Central Group is joining hands with Thai hotel operator Dusit International to open a $1.3 billion mixed-use development in the Si Lom commercial district as early as mid-2024. Dusit Central Park will include a rebuilt Dusit Thani Bangkok hotel as well as retail space.

The Mall Group plans to open the Emsphere shopping center, which will feature a concert venue, as soon as the end of 2023 on Sukhumvit Road.

One notable feature of some of the development projects is that they are built on land leased from the royal family, as is the case with One Bangkok and Dusit Central Park.

These renewal projects make sustainability a selling point. TCC seeks to obtain LEED certification, a U.S. benchmark that stands for leadership in energy and environmental design, for One Bangkok. The development will reuse treated water and optimize power consumption, with the help of partners such as Japanese players Mitsui & Co. and Tokyo Gas. Charoen Pokphand Group’s Forestias also envisions about 50,000 sq. meters of green space.

Some studies show rents can be up to 20% higher for buildings with environmental and other credentials than for conventional structures, said a senior analyst at Bank of Ayudhya.

“The owners leading development projects are aware that environmental factors, including the residential environment, can draw global companies,” said a manager at a Japanese construction company.

Bangkok trails behind Singapore as foreign multinationals’ choice for a Southeast Asian base. Singapore was named the fifth-most attractive city in the world in a 2022 ranking by the Institute for Urban Strategies, a Japanese think tank affiliated with Mori Building. Bangkok slid to 40th place from 35th the year earlier, scoring low on such factors as carbon dioxide emissions and cleanliness.

Still, plenty of multinationals see opportunity in the Thai capital. Japanese instant noodle maker Nissin Foods Holdings moved its regional headquarters operations from Singapore to Thailand in 2020. 

Mitsubishi Estate recently opened a high-rise office building in partnership with a Thai company. Nomura Real Estate Development and Mitsui Fudosan are developing condominiums for sale.

One concern about the building spree in Bangkok is its potential impact on rents. The openings of mega-complexes in coming years will increase the supply of office and commercial spaces by more than 30% from the present level, predicted the Bangkok-based Government Housing Bank.