Bangkok's new zoning law aiming to reduce city density is unlikely to materially reduce condominium development opportunities in the capital and could be positive for developers that tapped into less stringent zones, Citigroup said.
Bangkok's existing city plan is due to expire in May 2013. The broker said it maintained a positive view on Thai condominium sector.
"While condo development in small-sub roads in high density areas will be more difficult, we see more business opportunity in low/mid density areas," it said in a report.
"The new plan could add value to land plots that are located along mass transit lines given less stringent regulatory requirements," it said.
For instance, the new plan that aimed to remove all frontage road requirements versus previous requirements of 6-10 metre wide of frontage road, was positive for mid-range and high-end developers such as Land and Houses , Quality Houses , Asian Property Development and Supalai , it said.
LPN Development could also benefit as there would be more areas opening for development in the suburbs while developers that had scaled down condo development, like Pruksa Real Estate , were likely to miss long-term growth opportunity, it said.
The broader property subindex edged down 0.17 percent amid weak market sentiment. The benchmark SET index was down 0.09 percent. 1209 (0509 GMT) (Reporting by Viparat Jantraprap in Bangkok; firstname.lastname@example.org) ($1 = 30.655 baht) (Editing by G.Ram Mohan)
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