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Updated the key Industry Indicator: Office Building in BMR in each industry.By Patchara Klinchuanchun

The office rental market is expected to remain under pressure in 2026 due to a persistent oversupply that continues to outpace rental demand.

Office building for rent in 2019-2021 continues to expand Driven by the growth of the Thai economy

Depressed conditions have extended from 2020 into 2021 for the office rentals business, and the industry is continuing to battle against the stiff headwinds generated by this year’s severe outbreak of Covid-19 and the impacts of this on the economy. The pressure on costs that this has generated has then forced businesses to trim back on expenses, lay off staff and reduce their office sizes, but in 2022 and 2023, demand is forecast to make its way slowly out of this trough as the effects of the vaccine rollout begin to be felt, the economy rebounds, and the government moves forward with infrastructure projects, especially those connected with communications. The net effect of this will be to spur developers to step up their investments in new office space and/or in renovations of older buildings both within the CBD and in less central parts of the BMR. However, major developers’ investment plans indicate that over the period 2021-2023, growth in supply is likely to outpace what will be only somewhat weak recovery in demand, and so over the next 3 years, the occupancy rate will trend downwards.

The office rental business from 2024 to 2026 is expected to improve in line with the recovery of the Thai economy, led by the service sector, resulting in increased demand for office space. In particular, the Green Office segment is becoming increasingly important, as it attracts large corporations and international companies

The market for office rentals will strengthen over 2023 to 2025 on the ending of the Covid-19 pandemic and recovery in the economy, encouraging businesses to take on new hires. This in turn feeding stronger demand for office for at least 0.85 million sq.m., of which is expected to come to market over the next three years.

Through 2019, the housing market in the Bangkok Metropolitan Region (BMR) is expected to keep growth flat or slow down due to a high base effect in 2018. The market will also encounter headwinds in the form of: (i) the new, stricter regulations governing housing debt that determine loan limits on a loan-to-value ratio; (ii) the introduction of the Land and Building Tax Act, which will come into effect in 2020; and (iii) a weakening of the spending power of overseas (and especially Chinese) buyers caused by a softening of the world economy. These factors may then feed into higher operating costs, and a decline in both investor confidence and the willingness of buyers to purchase new properties. However, in 2020 and 2021, the market is expected to rebound on the effects of government spending on major infrastructure projects and on greater demand for accommodation from non-Thai buyers investing or working in Thailand.

The residential property market in the Bangkok Metropolitan Region (BMR) is expected to expand gradually over 2027–2029,

Through 2022 to 2024, the housing markets in the BMR should gradually strengthen on an economic rebound and rising consumer spending power

Through 2025, the market for residential property in the Bangkok Metropolitan Region (BMR) has been under great pressure due to softening domestic and international consumer purchasing power arising from the uncertainty generated by the global trade war. Through 2026-2027, the frail domestic economy and ongoing weakness in consumer spending will remain the major challenges to the housing market.