Thailand "Green" property demand will grow when the ASEAN Economic Community (AEC) take effect in 2015, as more multinationals setting up regional operations will opt for renting such facilities rather than normal office buildings, according to an expert. Thailand well placed to attract multinationals seeking HQ in Asean; green building costs 'don't have to be too high'
Assistant Professor Atch Sreshthaputra, a lecturer in the Architecture Faculty of Chulalongkorn University and an expert in green buildings, said most property developers still had concerns about the cost of constructing green buildings, believing that the investment would be higher than for a normal building.
In fact, he said, green-building design is not necessarily that expensive, with some projects costing about the same to construct as a standard building, and no greater than 10 per cent more costly, as architectural design matches the local environment.
"I am a consultant for the design of the Park Venture office building on Wireless Road, for which an application has been made for a green certificate from the Thai Green Building Institute, and which has been granted LEED [Leadership in Energy and Environmental Design] Platinum certification from the US.
"For this project, the investment cost is only 10 per cent above that for the same standard building type, but the building owner is offering rental prices more than 20 per cent higher than for other office buildings in the same location. This shows that tenants are willing to pay to get the best environment in which to work," he said.
Moreover, when the AEC becomes effective in 18 months' time, Thailand will offer the best location for multinational firms interested in expanding their investment within Asean, with green offices being the first choice for most of them seeking a head office in the region, he added.
Meanwhile, green condominiums will also increasingly become the first choice for home-buyers in the future, as they gain awareness of the benefits of living in a green condo building.
Phaithaya Banchakitikun, partner in Architects 49, the firm that designed Ananda Development's Ideo Mobi Sukhumvit, said Ideo Mobi was a prototype project showing that green condominium building did not have to result in high prices for home-buyers, as units were on offer from just Bt1.9 million.
Despite the reasonable cost, the project has been designed with the environment fully in mind by combining passive design - taking into account sunrise and sunset heat, wind and rain - and the selection of local construction materials to meet the green standard, he said.
"When we talk about green building, it doesn't have to involve technology like solar cells or wind turbines. Green construction can be achieved by using a simple design and easy-to- maintain features that will be convenient for home-owners," he added.
According to research by CB Richard Ellis, most green buildings in the US charge rents that are 5-10 per cent higher than for normal buildings. Nonetheless, green buildings enjoy higher occupancy rates than standard buildings.
Research also shows that existing buildings renovated under the green concept will recoup their investment after between six and 10 years. That is because they will save 30-50 per cent on electricity bills, depending on the building size, compared with the bills prior to renovation.
Green office buildings also mean staff will get a better environment in which to work, which in turn results in better performance, the research found.
In Thailand, there are currently two projects with LEED certification: the Energy Complex and Park Venture, which has been awarded a Platinum certificate for its construction process.
Meanwhile, the Kingdom has also established its own green building standard to match the environment. The Thai Green Building Institute's TREES initiative is short for Thailand Rating of Energy and Environmental Sustainability.
Applications have been made for 17 buildings to receive TREES certification since the standard was launched last year.
Meanwhile, the new Bangkok city plan promotes green building by providing bonus points entitling a developer to increase the floor-area ratio by up to 20 per cent for a building that wins TREES certification.
"We hope this will be the way to reduce the 'island heat' of Bangkok, with property firms interested in developing green buildings in the city rather than standard buildings," said Panyapas Nopphan, deputy director-general of the Bangkok Metropolitan Administration's City Planning Department.