According to Colliers International Thailand Research, the average selling price of property in Burma is increasing continuously. For downtown areas, the price in 2011 was more than US$1,400 (Bt42,000) per square metre when compared with about $1,200 in 2010. The supply of hotel rooms has been flat since 1998. That is why the number of hotel rooms to serve tourists and businessmen is a big problem for Burma.
MK plans to invest in a hotel in Rangoon
MK Group, a trade representative of Sahapat Group in Burma, plans to expand into the property business in that country in addition to the retail business by investing in a four- to five-star hotel in Rangoon, the company’s managing director Paradorn Kunkongkaphan said last week.
Paradorn said the idea of investing in the property business was initiated due to the low supply of hotel rooms in Burma. This has become a big concern after Burma’s move towards becoming a democratic country. Many investors are parading to explore business opportunities in this country, but the obstacle for them is the number of hotel rooms. He said the company was working with some partners for investment in a four- to five-star hotel, which will be located in Rangoon. The size of the investment has not been finalised.
MK Group has operated the retail business in Burma for 20 years. The company is the marketing representative of Sahapat Group, and Central Marketing Group (CMG) in Burma.
He said the company has run the retail business in Burma for 20 years. Revenue growth from the first year until 2008 was steady, with an average growth rate of 5-10 per cent per annum. Growth has increased sharply since 2008, going up 50-100 per cent.
“So, we’re optimistic about economic growth in Burma. And we’re confident about potential consumption,” he said.
Tony Picon, associate director for research, Colliers International, a property consultancy firm, said Burma lacked office buildings, hotels, condominiums and serviced apartments. The investments will take many years. Many foreign investors go to Burma and say that they will invest in the property business in the country. In fact, the inefficient investment law remains the obstacle. So, real investments do not occur, Picon said.
“Many foreign investors are looking to invest in the property business. The problem is the current regulation does not support them to do it right now. This is not fair to the Burmese people, who are hopeful that a lot of investment projects are coming into the country. Property is seeing a lot of speculation,” he said.
“They [foreign investors in the property business] may have to wait for the new investment regulation, which is expected to facilitate them more than the existing one,” he said.
According to Colliers International Thailand Research, the average selling price of property in Burma is increasing continuously. For downtown areas, the price in 2011 was more than US$1,400 (Bt42,000) per square metre when compared with about $1,200 in 2010. The supply of hotel rooms has been flat since 1998. That is why the number of hotel rooms to serve tourists and businessmen is a big problem for Burma.
