J.S.P. thrives on an integrated community approach
We began in 1991 by providing long-term rental and leasehold units to clients at our Rama III Road location. Back then our clients were predominantly freighters and cargo companies. In time we expanded to freehold projects under the JSP brand, focusing on outer Bangkok and other areas around Thailand.
J.S.P. Property Plc (JSP) was listed on the Market for Alternative Investment in November 2014. President and managing director Tanongsak Manotamraksa discusses the company’s strategy and outlook.
Please explain JSP’s history and business model.
Our development approach is unique in Thailand because all of our projects must have both a commercial and residential component and low-cost rental space. This way, we’re creating a self-sustaining community whereby all our tenants are able thrive on both a personal and a commercial level.
What are JSP’s development plans?
We have projects in various phases of development. At Sampeng 2, which covers 65 rai, we’ve completed the first two phases, which are mainly commercial. The final two phases and a condominium will be completed by 2017. At Miami Bangpu, covering 120 rai near the Bang Pu Industrial Estate, we’re developing both commercial and residential projects. Finally, at Tulip Square, which totals 32 rai, we’re close to completing the commercial areas, while the residential units are being transferred. These projects give us a combined backlog of more than 5 billion baht.
In the future, we’ll launch a 140-rai site in Rangsit Khlong 1 and a 210-rai site in Samut Prakan, both of which will have commercial and residential components. We’ve also expanded our prefabrication factories in Samut Prakan, which will give us a production capacity of 700 townhouses each.
JSP recently announced a joint venture with a Chinese firm. Why was that?
We have a large location in Chon Buri, 160 rai in tambon Bang Saray of Sattahip district, where we plan a mixed-use development worth 15 billion baht, and we require a partner for this. Thankfully we’ve found one in Zhongtian Construction Group, one of the largest construction companies in China.
We’re already working together, as they’re doing the construction at Sampeng 2 and wish to diversify into property investment as well. We are their first joint-venture partner in Thailand. The benefit of the joint venture is they can provide capital and construction as well as clients from their country.
Zhongtian will construct the Bang Saray project, while JSP will provide marketing and management. The first phase will launch next year with 200-300 beachfront condominium units and 300 shophouses. The second phase will include four high-rise condos, a 600-room hotel and an entertainment complex.
What differentiates JSP from its competitors?
As we build brand awareness, customers will understand our key selling point is we’re developing a real community, not just one condominium or one residential project. There are no direct competitors in this format, and this sets JSP apart from the crowd.
JSP’s financial performance has been impressive. What are the reasons for this?
Because we focus on acquiring and developing large plots of land, our cost per unit is lower compared with other developers, and even with an average selling price lower than that of our competitors, we’re able to realise a higher gross margin.
Also, our projects are on main roads, not smaller streets or sois. The combination of these two factors and our unique property development approach, where we ensure our clients have all the necessary infrastructure to lead their lives, enable us to realise a positive financial performance.
How has Thailand’s economic slowdown affected your business, and what other risks exist?
The recent slowdown has had an effect but a minor one compared with Thailand’s past economic slowdowns and can be easily absorbed by us and most businesses in the country. We want to assure our customers we’ll do what is in their best interest, not just ours, as we want all our customers to flourish in our projects, be they individuals or businesses.
How will the Asean Economic Community affect your business?
This is a very positive development, and Thailand will naturally benefit. The positives far outweigh the negatives. Compared with neighbouring countries, Thailand is a far more attractive location to live, and the quality of real estate relative to prices is far more compelling.
Where do you see JSP in five years?
We intend to be among the top 10 property developers in Thailand and feel we can achieve this through our unique approach. We’re fortunate that unlike in China, this specific business model in Thailand remains a blue ocean, with vast opportunities and no competitors, and with our track record and expertise we hope to thrive.
Source: Bangkok Post