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Published on July 27, 2007

It is not often that a developer and banker forge the kind of synergy that allows both parties to accomplish mega-residential projects the likes of which have never been seen here.

Areeya Development's recent securing of a Bt3.8-billion credit facility from TMB Bank comes after a strong working relationship that began four years ago with a modest project called Areeya Casa on Lat Phrao Road, says chairman and CEO Wisit Laohapoonrungsee.

His counterpart, TMB Bank president Subhak Siwaraksa, and Wisit were "able to reach a mutual understanding".

"Over the past four years, a strong bond based on trust and professional dealings meant we could create projects worth more than Bt10 billion," says the developer.

"Because we always delivered what we promised, our ties with TMB grew stronger with each project". The Bt3.8-billion facility is for two large A Space condominium projects and two medium-size housing estates in Navamin and Suthisarn.

Today, Areeya's triumphant undertaking, a 20-rai residential condominium called A Space Asoke-Ratchada, serves as a showpiece of original marketing and savvy design.

The first batch of 2,100 units in 10 buildings has been launched, and within a short time 1,800 units were booked.

The final 900 units inside two tall blocks will be launched at a later date. The current 10 buildings feature six swimming-pools and three carpark buildings. The new phase will also require additional common facilities.

Areeya's success is derived from the developer's ability to provide fully furnished units at competitive prices, throwing in everything from air-conditioners, kitchens, built-in and free-standing furniture, home appliances and even television sets.

It is uncanny to reflect back on how it began.

"The 20-rai plot was originally one of TMB Bank's NPAs [non-performing assets]," Wisit recalls.

"It was booked at Bt830 million. By taking the land off the bank's hands and developing it into A Space, we've increased its value many times over. Also, the bank gains further, because it is our main mortgage provider.

"For the next 15-20 years, the bank will have more than 2,000 mortgage customers who will provide them a steady stream of income."

Wisit 41, founded Areeya seven years ago, listing it on the stock exchange three years ago.

The Thammasat University finance graduate worked with Noble Development for several years before venturing out on his own soon after the 1997 economic crisis.

Wisit says the bank is also pleased to find Areeya customers from among some of their more reliable customers. The vast majority had been punctual with their mortgage payments.

TMB Bank will finance up to 95 per cent, depending on the buyer's credit standing.

The company has set aside another two blocks for development at a later stage. In all, the whole project should consist of 3,000 units when fully completed and be worth Bt5 billion. The two final blocks are likely to be taller.

Other projects include A Space at Onnuj, a joint venture with developer the Wandera Group, owner of the estate.

Areeya is Wandera's sales agent for the 1,500-unit project. Areeya obtains a 3-per-cent commission and has received Bt60 million from the sale of 1,300 units.

Areeya is now in talks with a major retail firm to open a 6.5-rai shopping mall in the front of the Soi Onnuj project, a move that is likely to boost its value should the deal be secured.

A third A Space project is being built on Nawamin Road.

Wisit says the company is also moving to launch a Bt2-billion town-house project on a 35-rai plot on Tiwanon Road in Thon Buri. The site will feature 240 town houses.

Called The Colours, it will apply the same knock-out approach as A Space, providing fully furnished homes.

Each unit is built on a 17-square-wah plot and has a frontage of 5.7 metres.

The built up area is about 105 square metres. Prices start at Bt1.8 million.

The Colours will use a fast-track method of construction that takes four or five months to complete a block of seven units.

The first showroom will be completed by September, and the 35-rai phase is part of a bigger estate encompassing 100 rai with a wide river frontage.

Itthi C Tan

The Nation