Prospect Development, a subsidiary of Munkong Housing Public Company Limited, has unveiled its More Than Just Space strategy, indicating that the industrial real estate sector will continue to grow, driven by positive factors from e-commerce, logistics, and related businesses. The company is advancing its warehouse and factory rental business under the Bangkok Free Trade Zone (BFTZ) project to meet the demand of clients of all sizes, expanding its footprint in three strategic industrial locations: Bangplee, Wang Noi, and Bang Pakong. They plan to fully push for Built-to-Suit buildings to support long-term leasing and sustainable growth.

Ms. Ratchanee Mahatdechkul, Managing Director of Prospect Development Co., Ltd. (“the Company”) under Munkong Housing Public Company Limited, the developer and manager of the ‘Bangkok Free Trade Zone’ project, stated, “This strategy launch marks a significant step for Prospect Development in reinforcing our expertise in space development and management of factories and warehouses. The More Than Just Space strategy reflects our commitment to delivering value that meets the diverse needs of businesses, combined with our strengths in various areas, such as the project’s location on Bangna-Trad Road, Km. 23, covering both the General Zone and Free Zone in the strategic Bangplee area, which has a high demand for logistics. Additionally, the diverse industrial tenant base has allowed us to continue growing amid the COVID crisis, particularly with existing tenants in the food processing sector showing a tendency for longer-term contracts.”

Launching the More Than Just Space strategy...
Amid increasing competition in the industrial real estate sector due to the growth trend of e-commerce, data from ETDA predicts that the e-commerce value in Thailand will reach 4.01 trillion baht in 2021. This factor serves as a significant driver for the warehouse and factory rental business, prompting a diversification of service offerings and the integration of technology for better management.

Driving the More Than Just Space strategy, Prospect Development emphasizes operational flexibility as a core principle because customer feedback is paramount. As the project owner directly overseeing infrastructure and building development, the space utilization of Prospect Development is more adaptable, effectively and swiftly responding to customer needs. Beyond standard buildings, they offer more options with Ready Built-to-Suit buildings that can be flexibly adjusted to meet customer requirements, and Built-to-Suit buildings designed for businesses with growth potential in the future, such as temperature-controlled warehouses and hazardous material warehouses.

Simultaneously, the implementation of a Partnership Model helps Prospect Development promote sustainability across all dimensions, from customers and partners to the surrounding community, through the construction and design of buildings under EIA (Environmental Impact Assessment) standards, considering physical factors, environmental impacts, and the quality of life for building users.

Goal to develop rental space to reach 1,000,000 square meters within 3 years
Currently, Prospect Development manages a total of 520,000 square meters of rental space and aims to continuously develop to reach 1,000,000 square meters across 6 projects located in three potential areas of the Thai industrial and logistics sector, including the Bangplee area, which caters to logistics businesses and large factories, Wang Noi, a significant industrial economic zone in the central region connecting routes to the north and northeast, and Bang Pakong, located in the Eastern Economic Corridor (EEC). The development of rental space to 1,000,000 square meters will require an annual investment of 1.5 billion baht. The overall rental rate for factory and warehouse space in the BFTZ 1 project on Bangna-Trad Road, Km. 23 remains bright, averaging around 90%.

Investment figures for the BFTZ project
- Rental rate of 90%, up approximately 5-10% from early 2021
- Targeting space to reach 1,000,000 sq.m. within 3 years
- Annual investment budget of 1.5 billion baht.

“We will not stop developing and will continue to expand our space according to Thailand's industrial strategy. With the experience of our professional team, we are committed to delivering quality buildings, controlling the environment in the project comprehensively, combined with a full range of One Stop Service and flexibility in service, we are confident that we can maintain our existing customer base and attract new clients to lease space in our projects. Currently, the main industries leasing space in our projects include logistics, electronics, food, automotive parts, and recycling. Additionally, the factors of infrastructure and skilled Thai labor continue to attract foreign investors to establish production bases and conduct business here,” Ms. Ratchanee added.

Expanding the empire in 3 strategic industrial locations The rollout of projects according to the roadmap will begin with
- BFTZ 2 project on Theparak Road launching in June 2022 with a rental space of 30,000 sq.m. in the General Zone
- BFTZ 3 project on Bangna-Trad Road, Km. 19 launching in July 2022 with a rental space of 110,000 sq.m. in both Free Zone and General Zone to cater to logistics providers or large factories
- BFTZ 6 project on Bangna-Trad Road, Km. 19 launching in Q2 2023 with a rental space of 40,000 sq.m. in the General Zone, offering both Ready Built and Built-to-Suit options
- BFTZ 4 project in Bang Pakong in joint venture with Sansiri Public Company Limited in Q1 2023 with a rental space of 200,000 sq.m. in Ready Built format
- BFTZ 5 project in Wang Noi in joint venture with FNS Holdings Public Company Limited with a rental space of 120,000 sq.m. set to launch in July 2022, and plans to deliver the first phase of Built-to-Suit warehouse space to Siam Makro with a size of 88,000 sq.m. in Q1 2023, featuring a temperature-controlled warehouse, 30 meters high, equipped with AS/RS and automated conveyor systems.

Overview of the warehouse and factory rental market: The Industrial Property business will emerge as a Key Player in the real estate market
- General warehouse businesses are expected to grow better than other formats
- Especially warehouses located in areas with logistics potential, such as BMR and EEC
- Demand for rental space is expected to increase by an average of 3.5% per year
- The growth of E-Commerce has led to an increase in warehouse rental rates, averaging 85-86%.

By the end of this year, Prospect Development plans to sell part of the assets in the BFTZ 2 and 3 projects worth 1.8 billion baht into the Prospect Logistics and Industrial Real Estate Investment Trust (PROSPECT REIT) and will continue to sell quality assets into the trust thereafter to generate steady long-term income from project management, paving the way for sustainable growth.

Prospect Development Co., Ltd. (“PD”) is a subsidiary of Munkong Housing Public Company Limited (“MK”) engaged in the development of rental factories and warehouses and property management under the Bangkok Free Trade Zone (BFTZ) project for over 10 years. Prospect Development is a leader in developing ready-made and Built-to-Suit warehouses and factories, delivering high-quality warehouses and factories to tenants in strategic locations with comprehensive necessary utilities.