Kanda Property Unveils Real Estate Strategy for 2021
Kanda Property Unveils Real Estate Strategy for 2021
“Kanda Property” reveals its aggressive strategy for 2021, launching 5 horizontal housing projects while entering the Pattaya market, aiming for stable growth by developing existing land and delaying new land purchases, with a sales target exceeding 3.2 billion baht. The company is adjusting its strategy to cope with the highly competitive market and hints at plans to penetrate the market for homes priced below 1.6 million baht.
Additionally, new projects were launched in areas where the company already has existing projects, including the iLeaf Prime project on the Ring Road-Rangsit Klong 4 and the iLeaf Prime 2 project in Thalang, Phuket.
Despite the economic impact from the COVID-19 virus since early 2020, the new projects received satisfactory responses, with each project achieving better sales rates than the overall market affected by the pandemic. As a result, the company achieved sales exceeding 3 billion baht in 2020, surpassing its target of 3 billion baht, with transfer revenue of 1.95 billion baht.
“Although revenue slightly fell short of the target of 2 billion baht due to delays in launching new projects during the peak of the pandemic and increased loan rejection rates from banks, it is still considered satisfactory and aligns with the plan for stable growth and a strong financial position,” Mr. Hatsakorn stated.
For the outlook in 2021, the overall economy is not expected to be worse than in 2020, even with lockdowns in some provinces or areas due to a new wave of COVID-19. However, it is believed that the experience from the 2020 lockdown will enhance each company's resilience in managing finances and personnel more effectively. The overall economy in 2021 is expected to resemble that of 2020, with a slowdown in the first half and a better recovery in the second half.
In the horizontal housing market, demand is not expected to increase significantly, but there is a trend of buyers shifting from condominiums to horizontal housing. The increasing number of players in the horizontal housing market will heighten competition in each location, leading companies to intensify campaigns and promotions to capture market share, which will result in slight growth in the horizontal housing market. However, the high-rise housing market is expected to remain negative due to declining sales of new condominiums, with the overall real estate business expected to stabilize.
In 2021, the company will continue to focus on stable growth and a strong financial position by delaying new land purchases and developing existing land for new projects, with a sales target of 3.3 billion baht and revenue target of 2.2 billion baht. The plan includes launching a total of 5 new projects worth a combined 3.631 billion baht, consisting of:
1. iLeaf Prime Pracha Uthit 90, a townhouse project with 211 units valued at 441 million baht.
2. iLeaf Prime 2 Rama 2 Km.14, a project of single-detached and semi-detached houses with a total of 228 units valued at 805 million baht.
3. iLeaf Pattaya-Jomtien, a new project location for the company this year, consisting of 384 townhouses valued at 875 million baht.
4. iLeaf Prime 2 Pracha Uthit 90, a townhouse project with 268 units valued at 541 million baht.
5. iLeaf Prime 2 Ring Road-Rangsit Klong 4, a townhouse project with 460 units valued at 969 million baht.
“When combined with previously launched projects in 2021, the company will have a total of 17 projects available for sale across 9 locations, with a total project value of approximately 9 billion baht. At the same time, there is land awaiting development for future projects valued at a total of 13 billion baht,” Mr. Hatsakorn stated.
Meanwhile, the company has adjusted its strategies in construction, product development, and services to accommodate increasing competition. In construction, the company has increased the number of completed homes ready for sale and transfer to meet sales targets during project launches, enabling quicker transfers and enhancing cash flow for the company, while also catering to the purchasing behavior of the new generation who prefer to buy without down payments.
Additionally, to adapt to changes from the current situation, the company has designed 8 functional features within homes, termed “8 f(x),” to support diverse usage needs, addressing the varying demands arising from changing lifestyles, while adhering to the “4 KANDA CONCEPT,” which includes ECO SMART/EASY MAINTENANCE/3 GENERATIONS/FLOOD PROTECTION as the core design principles.
“Regarding the issues arising from increasing household debt burdens and banks tightening loan approvals, the company has adopted a proactive strategy by forming teams to work closely with various banks to address problems and provide advice to customers whose loans are not approved, in order to retain customers for the long term,” Mr. Hatsakorn added. He also mentioned that in addition to expanding into new locations, another approach to foster growth for the company is to expand its customer base, shifting from primarily targeting products priced at 2 million baht and above to exploring the feasibility of targeting customers in the market below 1.6 million baht, which still has high demand but faces challenges due to rising project development costs. The key is to keep land costs low, which may require moving outside the city, but there must be job opportunities available. A conclusion on expanding the customer base is expected soon.
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