Bangkok Property Market - Apartment Investments

Bangkok Serviced Apartment Market — A New Horizon for Investment

In recent years, the Bangkok serviced apartment market has demonstrated steady growth and is becoming increasingly attractive to both investors looking for reliable and profitable assets and tenants wishing to combine the comfort of an apartment with the amenities of a hotel. A successful combination of residential and hotel formats, well-thought-out infrastructure and a high level of service make serviced apartments one of the most promising real estate segments in the Thai capital.

Serviced apartments — differences from other formats

Serviced apartments are something between an apartment and a hotel room. On the one hand, they offer fully furnished and equipped living space with all the amenities for long-term stays:

1. Spacious apartments from 30 to 200 m2 with separate bedrooms, living rooms and kitchens
2. Modern design and high-quality finishing
3. Household appliances, dishes, bed linen and everything you need for a comfortable life
4. Possibility of short-term and long-term rentals from several days to a year or more

On the other hand, residents of serviced apartments can use additional services and infrastructure typical of hotels:

1. 24-hour reception and security service
2. Regular cleaning and linen change
3. Fitness centers, swimming pools, saunas, spas, game rooms
4. Restaurants, cafes, lounge areas, mini-markets
5. Business centers, conference rooms, meeting rooms
6. Transfer, car rental, tourist services

Thus, serviced apartments combine the privacy and autonomy of an apartment with comfort and hotel service. This format is especially convenient for business travelers, expats, students and anyone who comes to Bangkok for a period of a couple of weeks to several years and does not want to burden themselves with household issues and buying furniture.

The growth of the serviced apartment market in figures and facts

Bangkok is the undisputed leader in Thailand in terms of the number and variety of serviced apartments. According to the consulting company GPG Thailand, at the end of 2020, the city had about 24,000 units in more than 300 projects. This is almost 2 times more than 10 years ago, and demand continues to grow.

Among the key factors stimulating the development of the market, experts highlight:

1. The influx of foreign specialists working in international companies and preferring to rent housing rather than buy.
2. The growth of tourist flow and the popularity of Bangkok as a destination for long-term vacations, study, treatment
3. Development of transport infrastructure (metro, highways), increasing the attractiveness of new areas.
4. Increased supply from developers actively building up the city with multifunctional complexes with serviced apartments.

The main tenants of serviced apartments remain expats from Japan, Korea, Singapore, Hong Kong, Taiwan and China, working in Bangkok for at least 1 year. At the same time, in recent years, operators have noted an increase in the number of Thai clients renting apartments for a weekend getaway or to accommodate relatives.

Based on the price and service level, serviced apartments are divided into 3 main classes:

1. Economy — (15-45 sq. m, $600-1200 per month). Compact studios with basic furnishings, a shared lobby and a minimum set of services. Usually located outside the center.
2. Business — (45-120 sq. m, $1200-4000). The most common option with all the amenities, high-quality finishing, a full kitchen, often a swimming pool and fitness.
3. Luxury — (from 120 sq. m, from $4000). Spacious residences in central areas with designer interiors, exclusive amenities and personal service according to 5* hotel standards.

The average occupancy rate of serviced apartments is about 80%, with the highest demand for business class properties in prestigious locations such as Sukhumvit, Silom, Siam.

Download the mobile app!

Install our app and get all the tools you need to search for real estate abroad in your smartphone! The mobile application will allow you to quickly access your personal account, manage your favorite properties and track your requests, directly exchange messages with sellers and buyers.

Investment attractiveness

Serviced apartments in Bangkok are one of the most profitable real estate investment tools with a gross annual yield of 6-8%, and in some projects up to 10-12%. This is significantly higher than the average yield of condominiums (4-5%) and regular apartments (3-4%). ​​In addition, serviced apartments do not require the personal participation of the owner. Management companies take on all the worries of finding tenants, maintenance, repairs, paying bills and transfer the net income to the owners.

The cost of the apartments themselves is also gradually increasing following demand. According to GPG Thailand, prices for serviced apartments in Bangkok have increased by 30-40% over the past 5 years, overtaking condominiums and houses. At the same time, the range of prices is quite large:

1. Economy class apartments start from 2-3 million baht ($60,000 — 90,000) for a compact studio in a remote area and can bring 5-7% per annum.
2. Business class costs 4-10 million baht ($120,000 — 300,000) depending on the area, location and infrastructure and provides 6-8% profitability.
3. Luxury residences in the center and near the river can cost 20-50 million baht ($600,000 — 1,500,000) and more, but will also be rented out at appropriate rates, bringing up to 10% per annum.

Another advantage of investing in serviced apartments is the possibility of obtaining a long-term visa. When buying real estate from 10 million baht, foreigners can apply for an investor visa, allowing them to live in Thailand for up to 20 years with the right to work.

Best Locations and Projects

The bulk of serviced apartments are concentrated in the central business districts of Bangkok along the BTS and MRT metro lines. The most popular are:

1. Sukhumvit is the main «expat» street of the city with a huge selection of apartments, hotels, shopping centers, restaurants and entertainment for any budget. Here are such famous complexes as Compass Skyview (from 4 million baht), Ascott Thonglor (from 8 million), Sindhorn Midtown (from 12 million).
2. Silom Sathorn is a prestigious financial district with luxurious residences and hotels. Bright examples are Banyan Tree Residences (from 20 million baht), The Sukhothai Residences (from 35 million), The Ritz-Carlton Residences (from 40 million).
3. Riverside (Chao Phraya) is an elite area along the river with impressive views and unique real estate formats. Projects such as Magnolias Waterfront Residences (from 12 million baht), The Residences at Mandarin Oriental (from 40 million), Four Seasons Private Residences (from 60 million) stand out.
4. Raatchadamri-Siam is a shopping and tourist center with skyscrapers and mega-malls. Interesting options are Klass Langsuan (from 10 million baht), Waldorf Astoria Residences (from 25 million), The Residences at Sindhorn Kempinski (from 30 million).
5. Lumpini-Prom Phong is a green area with parks, ponds and respectable condominiums. High-quality apartments are presented in Marque Sukhumvit (from 5 million baht), 185 Rajadamri (from 30 million), Saladaeng One (from 35 million).

Trends and Prospects

The Bangkok serviced apartment market continues to develop actively, despite the pandemic and economic slowdown. Developers are adapting to new realities and launching modern multifunctional projects that combine housing with offices, retail and hotel infrastructure. Among the trends and promising areas, experts highlight:

• Mixed formats and infrastructure hubs — such large-scale projects as One Bangkok, The PARQ, Dusit Central Park combine serviced apartments with office towers, shopping galleries, parks, museums and become new centers of business and social activity.
• Branded residences — more and more global luxury hotel chains are entering the Bangkok residential real estate market — Ritz-Carlton, Mandarin Oriental, Waldorf Astoria, Four Seasons offer branded residences with exclusive design and service.
• Innovative concepts and amenities — developers are experimenting with new apartment formats (two-story, with terraces and gardens), using «smart» technologies, eco-friendly materials, creating unique infrastructure (sky bars, panoramic pools, fitness parks).
• Suburban expansion — with the development of the transport network and remote work, developers are exploring new locations outside the center, where they can build more spacious and affordable apartments in low-rise buildings that integrate into the natural environment.
• Focus on domestic demand — in the context of a shortage of foreign tenants due to Covid restrictions, operators are switching to a local audience, offering attractive prices, service packages, loyalty programs for Thai clients.

Overall, despite the short-term challenges associated with the pandemic and global instability, most analysts maintain a positive outlook for the Bangkok serviced apartment market. A growing economy, developed infrastructure, high quality of life and a variety of real estate formats will continue to attract foreign specialists, students, investors to the Thai capital, maintaining a stable demand for living in serviced apartments.

Let's sum it up:

• Serviced apartments are one of the most dynamic and promising segments of the Bangkok real estate market, combining the advantages of residential and hotel real estate. Thanks to their convenient format, well-thought-out infrastructure and high-quality service, serviced apartments are in high demand among expats, business tourists and local residents. For investors, serviced apartments offer an attractive yield of 6-8% per annum in a reliable and liquid asset with the potential for value growth. A wide selection of projects of different classes and price ranges allows you to choose the best option in accordance with your budget and investment goals.
• Among the key trends are the emergence of multifunctional complexes combining serviced apartments with offices, retail and public spaces, the spread of branded residences managed by international networks, the development of new areas outside the center, the introduction of «smart» technologies and eco-friendly solutions. In the long term, according to most experts, the Bangkok serviced apartments market retains significant growth potential, based on such factors as economic and tourism recovery, infrastructure development, improved quality of life, and the influx of foreign specialists and investors.
• Of course, investing in real estate is always associated with certain risks that must be taken into account — market volatility, changes in legislation, competition from other formats. Therefore, it is so important to carefully select projects with a reliable developer reputation, a good location, a well-thought-out concept and professional management. In general, Bangkok serviced apartments are an interesting opportunity for both living and investing. This is a modern and comfortable real estate format that meets the needs of a dynamic metropolis and offers a balanced combination of residential and commercial characteristics. And as the infrastructure and economy of the Thai capital continue to develop, the role and attractiveness of serviced apartments will only increase, opening up new horizons for residents, businesses and investors.