Professionalism, reliability and agility have been key to helping property consultancy CBRE Thailand ride the cycle of ups and downs in the Thai property sector over the past 34 years.
Aliwassa Pathnadabutr, the company's chairwoman, said professionalism and reliability are required qualities for a property consultancy to sustain business over the long run, retain clients and ensure they keep returning.
"As a consultant, we have to give straightforward advice that should be supported by data," she said. "Although sincerity may mean we don't add a client, we still have to carry on. This has been one of our principles since we started in Thailand."
FIRST CONSULTANT
The US-based company set up a Thai office in 1988 under Richard Ellis Co as it saw signs of an economic recovery in Thailand, said Ms Aliwassa, one of the founding staff.
"As the first international property consultant in Thailand, we had to start from zero," she said. "Most property brokers were focused on land sales. We had to set up a database on our own, walking to survey each office tower because no office market data was available."
Its research covers offices, residential, investment, land, retail, hotels, and industrial and logistics sectors, giving CBRE the oldest property market database.
For offices, Bangkok's total supply since 1988 has risen from 1 million square metres with an average rent of 200 baht per sq m per month, to 9.5 million sq m priced at 988 baht for grade A and 740 baht for grade B as of the end of 2021.
Overall office space is projected to increase to 10 million sq m in 2022, according to CBRE's research.
The company reported the land price per sq wah in Bangkok soared from 250,000 baht in 1988 to 3.9 million baht in 2020.
BRACING FOR A SLIDE
From 20 staff in 1988 to 400 in 1996, CBRE grew in line with the property market boom until 1997, said Ms Aliwassa.
With up-to-date market data, the company identified a property bubble and signs of a crash starting in 1995.
At the time, massive speculation on condos and land led to an eventual crash because there was minimal regulation, she said.
"Property consultancy is a diversified business by nature," Ms Aliwassa said. "When leasing and sales are down, property management, valuation and research remain active. This makes us profitable, even as revenue decreases."
As the residential market in 1997-98 was sluggish, the company shifted the residential sales team to the investment unit because there were a lot of foreign investors scooping up Thai properties and loans after the country's financial crisis in 1997.
Another busy segment during the financial crisis was property valuation, as foreign investors wanted this service when deciding to buy Thai properties.
As the only international consultancy doing real estate market research with its own data, CBRE was also appointed by the World Bank to do property market surveys.
This was the origin of the company's quarterly report for each property sector.
"We had very minimal downsizing in 1997, which helped us come back very quickly," Ms Aliwassa said.
"Few people had property knowledge and expertise at the time. If we laid them off, we might not be able to get them back."
AN UPSURGE
The market boomed again in 2001, driven by the residential sector, especially the condo segment as the skytrain served a vast mass transit demand.
CBRE's residential sales team served both local developers that could not recruit new sales teams in time for a market recovery, as well as a large number of overseas property companies that expanded into Bangkok.
"Foreign investors looking for a joint venture with local firms required an international consultancy to do marketing," she said. "We have many local and foreign clients, which helped our residential sales business to become more robust."
Proceeds from the residential sales department, which includes new projects, resale units and Phuket resort homes, was the company's largest contributor, accounting for 40% of total sales, said Ms Aliwassa, formerly managing director from 2004-21.
According to the Department of Business Development, CBRE's revenue has increased almost every year since 1998.
The biggest growth was recorded in 2015, when it expanded by 105% to 1.47 billion baht, its first time breaching 1 billion baht.
Revenue kept rising with growth of 53%, to 2.25 billion baht, in 2016.
The revenue peak was in 2018 when the company secured 2.55 billion baht after being the sole agent for a British Embassy plot on Ploenchit Road priced at 19 billion baht, she said.
NEW BUSINESS
CBRE was affected by the pandemic in 2020, as were most businesses. That year its revenue declined by 11% to 2.26 billion baht, the second significant drop since its establishment in Thailand.
However, it recovered in 2021, boosted by residential sales after it diversified to the low-rise housing market in 2019 after sensing that condos were performing sluggishly based on a glut and high prices.
Now with 1,300 staff, CBRE plans to be more aggressive in its new businesses, said Roongrat Veeraparkkaroon, formerly head of commercial transaction services who was promoted to managing director on Jan 1, 2022.
"We will capitalise on the post-pandemic trends in property that include ESG [environmental, social and governance] and hybrid work as we aim to grow by 15%, back to pre-pandemic levels," she said.
One new business is energy and sustainability services, providing advice to landlords who want to upgrade their properties to get LEED green building certification or the WELL building standard, which focuses on people's health and wellness.
Other new businesses include project, facilities, hotel asset and transaction management, workplace strategy, and tenant experience mobile application.
"As a professional consultant, it is our duty to be a trendsetter, giving clients reliable advice and helping them adjust to upcoming changes and challenges," said Ms Roongrat.
