New plan proposed for major Na Jomtien development
In a recent announcement, the Charoen Pokphand (CP) Group and Magnolia Quality Development Corporation (MQDC), its property arm, stated they will revise a 30 billion baht property development plan which had been slated for the Na-Jomtien area after buying back all the shares from Chinese developer Greenland Holding Group, the project’s former co-investor.
Under the revised plan, the project will have more retail space. This is because MQDC will be partnering now with Shanghai Kinghill Ltd, one of CP’s China-based companies.
One of Shanghai Kinghill’s main strengths is its expertise in retail, which MQDC has decided to incorporate into its new plan. Shanghai Kinghill is the operator of Super Brand Mall which is one of Asia’s largest entertainment complexes.
The project was first put on the table in March 2014 when CP Group, MQDC and Greenland combined to launch a joint venture called CPMG Co, Ltd with a registered capital of one billion baht. CP Group held a 41 percent share, MQDC held 10 percent and Greenland the remaining 49 percent.
The plan by CPMG was to develop a large-scaled residential project worth 30 billion baht, which would comprise condominium, hotel, serviced residences and some retail space, located on 40 rai in the Na Jomtien area at a plot formerly used by Charoen Pokphand Foods, a CP Group business.
However, in a change of plans, CP agreed to buy Greenland’s 49 percent stake back earlier this year. Greenland focuses on the mass residential market, while CP and MQDC want to target the upscale market for the site with the aim of properly realizing what they considered to be the plot’s potential.
The new plans are expected to be completed early next year. It will be one of six new property development projects, worth a combined 50 billion baht, which MQDC plans to launch in 2017.
During the first nine months of this year MQDC stated it had registered 4.8 billion baht in presales and aims to have six billion baht by the end of the year, which will be down from eight billion baht in 2015.
The company said it will realise 3.5 billion baht in revenue, the same as last year.
It expects revenue will rise to more than 20 billion baht in 2018 with the completion of its large-scale projects.
MQDC is a subsidiary of DT Group of Companies (DTGO), and currently has three businesses including property, trading and design.
The trading arm generated the highest revenue for the group with four billion baht last year, and is expected to bring in six billion baht this year, although over the
next few years property will generate the highest income for the group. The group plans to establish two new firms, in construction and property management, this year to support their property businesses.