_Office Market Q3 2024

“In the third quarter of 2024, the Bangkok office market demonstrated steady momentum, driven by substantial supply additions and increased leasing activity. The completion of prominent projects like One Bangkok boosted the city’s total office space to 6.31 million sq m, reflecting the growing prominence of large-scale, mixed-use developments in reshaping the city’s skyline.”

December 02, 2024

Market Overview

Thailand’s economy grew 3.0% YoY in Q3 2024, its fastest in two years, driven by strong investment, tourism, and exports, according to NESDC data. Growth was led by the service sector, while the industrial sector slowed, and agricultural production declined. Despite the positive performance, officials highlighted challenges in sustaining momentum due to high household debt, sluggish demand from China, and borrowing costs. After mounting government pressure, the central bank responded by cutting its policy interest rate to 2.25% in October. The government is set to convene on Tuesday to discuss additional stimulus measures, including the second phase of its "digital wallet" handout scheme.

The Business Sentiment Index (BSI) continued its decline in September 2024, with the manufacturing sector driving the recent downturn due to weak demand in electronics and plastics. While the non-manufacturing index remained stable, real estate confidence dropped amid economic uncertainty and high household debt, limiting property sales. However, the 3-month expected BSI saw a slight rise, supported by improvements in the construction and hospitality sectors, buoyed by government projects and the year-end tourism season.

Supply

Bangkok's total supply of office space expanded this quarter by 151,000 sq m, or by 2.5% QoQ, to 6.31 million sq m following the completion of One Bangkok Tower 3 and Tower 4 and Rangsit Business Park. Consequently, green buildings increased from 26% to 28% of total supply. 54,000 sq m was withdrawn as 3 buildings were removed from the market.