MK Real Estate celebrated its 50th anniversary this year after holding on to its purely Thai identity through three economic crises and seeing many other firms fall by the wayside.

Chuan Tangmatitham, 70, established MK Real Estate in 1956 when, as a 20-year-old builder, he used his family's savings of Bt5,000 to set up the company. It now has assets worth Bt7.16 billion.

The company develops property projects under the brand "Chuan Chuen". In 1990, it was the second property firm to apply for a listing on the Stock Exchange of Thailand, one year after Land and Houses.

Looking back over the past half-century, MK Real Estate's chief executive remembers the tough times most vividly, and the worst was the financial crisis of 1997.

"We faced two crises before 1997. The first was the oil shock of 1979 and the second, Thailand's financial crisis in 1989. But their impact on our business wasn't so negative because at that time, we had a lower level of loans and our cash flow was enough to manage the business," Chuan recalls.

When the 1997 economic crisis struck, the central bank shut down 56 finance firms and the business environment changed abruptly because companies faced a credit crunch.

"Most of our customers were laid off from their jobs and defaulted on housing deals signed before the crash, while our contractors also faced financial crisis. We had to solve our problems by negotiating with our creditors to reschedule loan repayments. That helped us survive the crisis," he says.

In the grim years after 1997, Chuan set aside business expansion to focus on existing projects. It was 2001 before MK Real Estate began to grow again.

Despite that hiatus, Chuan says he is proud to have saved his business from foreign investors who shopped around after the crisis to take over or join in ventures with struggling local property firms.

"We wanted to solve our financial problems by ourselves. I didn't want to sell a major stake to others, including foreign investors."

In 1997, when Chuan reached 60 years old, he was suspending new property projects and trying to reduce his company's bank loans, simply to stay afloat. By 2002, MK Real Estate was in a good state of health, with a debt-to-equity ratio of 0.6:1 - substantially lower than its 1997 figures of 1.5:1.

"We tried to construct houses according to our customers' orders and deliver them on time. That helped create a cash flow sufficient to operate our existing projects. It also helped our relationship with our customers, because other property firms lost their contracts."

The first new projects were launched in 2002, and now MK Real Estate is operating 15 property projects worth about Bt10 billion.

After 50 years at the helm of MK Real Estate, Chuan says he still has enough energy to operate the company, but his daughter and son - Chutima and Chukiat Tangmatitham - are playing a more and more prominent role, having joined the firm in 2001.

"I have no plans to retire, but I will cover only business policy, while my daughter and son take care of business operations," he says.

"My business goal in the next decade is to drive the company up into the top five in the Thai property market. My key business policy is to be sincere with my customers and construct quality houses on the best locations."

MK Real Estate recorded total sales of Bt1.85 billion in 2006 and aims to achieve Bt2.2 billion this year. The company is among the top 15 listed property firms in the market.

Somluck Srimalee

The Nation