Advance Blog

April 29, 2022
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The Latest Diversification Strategy by Thai Residential Developers

Bangkok – March 22, 2022 – The effort to survive through growing competition, economic and financial challenges, and the ripple effect of the pandemic, have pushed residential developers in the last couple of years to adopt bold new diversification strategies and question the traditional approach of specializing in one market segment. CBRE, the leading international property consultant, reveal their latest diversification strategic move in their complementary support services.

Mr. Rathawat Kuvijitrsuwan, Head of Research and Consulting, CBRE Thailand commented, “In the past, residential developers have diversified their strategy to cover all range of development projects, with some venturing into the condominium market, hospitality and retail. Now, real estate developers are once again extending their diversification strategies beyond their comfort zones, adding more offerings to their core businesses while lowering the risks of being too dependent on the real estate industry alone. They are adding the lifestyle components of real estate, such as health and wellness, food, and services to their portfolios.”

The recent history of Thai residential developers is a story of specialization shifting to diversification. With the new market cycle after the 1997 Asian financial crisis, residential developers focused on developing houses or condominiums, mainly in Bangkok and, in some cases, they specialized in one market segment. As the market had become more competitive, many developers sought to diversify, initially by expanding to other provinces or segments. This mainly locational diversification was the first stage of an ongoing process.

A few developers have pioneered ways to diversify to several types of residential developments and cover varying market segments or to different sectors, such as AP (Thailand), who has expanded to cover detached houses, townhouses and condominiums across all ranges of grades, and Land and Houses, who apart from housing projects, has ventured into condominiums, hospitality and retail centers.

“Unfortunately, for many of these developers, their diversification strategy coincided with the most challenging period, both economically and financially, that Thailand and the rest of the world has ever experienced. The impact of the pandemic on the real estate sector has been significant and to survive, residential developers have made huge efforts to clear their unsold inventory, put development projects on hold and reevaluate their strategies going forward. Many have decided the time is right to diversify into other industries outside of real estate,” added Mr. Rathawat.

For example, Property Perfect created a partnership in the rubber gloves business. Even before the pandemic, Pruksa Holding had allocated significant resources by expanding in the medical and wellness business by building and operating Vimut Hospital.

Last year, a number of other real estate developers announced plans to diversify into the health and wellness trend as well as fintech, technology and consumer goods. Sansiri set their future strategy to diversify into new businesses related to healthy food and clean energy. Previously, Sansiri had invested in fintech, digital assets and EV chargers while Nusasiri announced plans to transform into a holding company within this year to invest in other businesses apart from the real estate sector, including wellness, agriculture-industry and technology. Others have adopted a more traditional approach to diversification by adding complementary elements to their real estate projects, for example, AssetWise announcing plans with Bangkok Healthcare Service to incorporate a rehabilitation center for the elderly in some of their projects. 

“Time will tell whether diversifying into industries outside of the developer’s core competencies will prove to be successful for these companies, but it is an indication of how specialization can be limiting when that particular industry suffers a downturn. We believe diversification remains the right strategy to move forward to minimize risks as well as uncertainties,” concluded Mr. Rathawat.

CBRE Group, Inc. (NYSE: CBRE), a Fortune 500 and S&P 500 company headquartered in Dallas, is the world’s largest commercial real estate services and investment firm (based on 2021 revenue). The company has more than 105,000 employees serving clients in more than 100 countries. CBRE established an office in Bangkok in 1988, followed by its Phuket office in 2004. CBRE serves a diverse range of clients with an integrated suite of services, including property sales and leasing; investment management; appraisal and valuation; strategic research and consulting property management; facilities, transaction and project management. Please visit our website at

Rathawat Kuvijitrsuwan

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