Compared to others markets of the world, the REIT market of Thailand is developed, and its first REIT was introduced in 2014. In this article, you will not only learn about REITs with overseas properties but also about those who only invest in domestic real estate.
As a foreigner, if you have invested in real estate in any country of Southeast Asia, especially Thailand, you will have the idea that it is not child’s play. These restrictions are not only for the foreigners, but the local residents face the unit value restriction, which depends on your residential status and many other things.
Just for a while, even if it is easy to buy real estate and freehold property in Thailand, you should not underestimate the benefits of investing in Thailand’s REITs.
Key points in this guide:
- REITs (Real Estate Investment Trust) Thailand list
- Are foreigners allowed to buy Thailand’s REITs?
- How to buy REIT units in Thailand?
- What are the requirements to set up and run REITs in Thailand?
- Advantages of investing in Thailand’s REITs.
REITs in Thailand stock Exchange
REITs and property funds currently listed on the Thailand stock exchange:
|AIM Commercial Growth Freehold And Leasehold REIT (AIMCG)||MFC Patong Heritage Property Fund (M-PAT)|
|AIM Industrial Growth Freehold & Leasehold REIT (AIMIRT)||MFC-Nichada Thani Property Fund (MNIT)|
|Amata Summit Growth Freehold & Leasehold REIT (AMATAR)||MFC-Strategic Storage Fund (M-STOR)|
|Bangkok Commercial Property Fund (BKKCP)||Millionaire Property Fund (MIPF)|
|Bhiraj Office Leasehold REIT (BOFFICE)||Multi-National Residence Fund (MNRF)|
|Bualuang K.E. Retail Leasehold REIT (BKER)||Nichada Thani Property Fund 2 (MNIT2)|
|Bualuang Office Leasehold REIT (B-WORK)||Pinthong Industrial Park Property Fund (PPF)|
|C.P. Tower Growth Leasehold Property Fund (CPTGF)||Prime Office Leasehold Property Fund (POPF)|
|Centara Hotels & Resorts Leasehold Property Fund (CTARAF)||Quality Hospitality Leasehold Property Fund (QHOP)|
|CPN Commercial Growth Leasehold Property Fund (CPNCG)||Quality Houses Hotel & Residence Freehold & Leasehold Property Fund (QHHR)|
|CPN Retail Growth Leasehold REIT (CPNREIT)||Quality Houses Leasehold Property Fund (QHPF)|
|Dusit Thani Freehold & Leasehold REIT (DREIT)||S Prime Growth Leasehold REIT (SPRIME)|
|Erawan Hotel Growth Property Fund (ERWPF)||Sala @ Sathorn Property Fund (SSPF)|
|Frasers Property Thailand Industrial Freehold & Leasehold REIT (FTREIT)||Samui Airport Property Fund (Leasehold) (SPF)|
|Future Park Leasehold Property Fund (FUTUREPF)||Samui Buri Property Fund (SBPF)|
|Gold Property Fund (Leasehold) (GOLDPF)||Siri Prime Office Property Fund (SIRIP)|
|Golden Ventures Leasehold REIT (GVREIT)||Sri Panwa Hospitality REIT (SRIPANWA)|
|Grande Hospitality REIT (GAHREIT)||Strategic Hospitality Extendable Freehold & Leasehold REIT (SHREIT)|
|Hemaraj Industrial Property And Leasehold Fund (HPF)||Sub Sri Thai REIT (SSTRT)|
|Hemaraj Leasehold REIT (HREIT)||T.U. Dome Residential Complex Leasehold Property Fund (TU-PF)|
|IMPACT Growth REIT (IMPACT)||Talaad Thai Leasehold Property Fund (TTLPF)|
|KPN Property Fund (KPNPF)||Tesco Lotus Retail Growth Freehold & Leasehold Property Fund (TLGF)|
|Land & Houses Freehold & Leasehold Property Fund (LHPF)||Thai Industrial Fund 1 (TIF1)|
|LH Hotel Leasehold REIT (LHHOTEL)||Thailand Hospitality Property Fund (TLHPF)|
|LH Shopping Centers Leasehold REIT (LHSC)||Thailand Prime Property Freehold & Leasehold REIT (TPRIME)|
|Luxury REIT (LUXF)||Trinity Freehold And Leasehold Property Fund (TNPF)|
|Major Cineplex Lifestyle Leasehold Property Fund (MJLF)||Urbana Property Fund (Leasehold) (URBNPF)|
|MFC Industrial Investment Property And Leasehold Fund (M-II)||WHA Business Complex Freehold And Leasehold REIT (WHABT)|
|MFC Industrial REIT (MIT)||WHA Premium Growth Freehold & Leasehold REIT (WHART)|
Are foreigners allowed to buy Thailand’s REITs?
Just like the other Asian countries, REIT investment is the same in Thailand as well. For investment, you must have a brokerage account, but it is advised to have a local broker in contact.
You can also buy shares with the help of foreign brokers, but their transaction fees are a bit high, which is around 50 USD. On the other hand, getting in touch with a local Thai broker will be affordable, and they charge you about 2 USD, which is fairly reasonable.
Even though buying REIT shares in Thailand through foreign investors is expensive, foreign investors prefer to keep them as their first choice. If you want to open a local brokerage account in Thailand, it needs a lot of paper, and you might have to visit Thailand as well. Moreover, you must be a permanent resident of Thailand or at least have a long-term visa.
How to buy REITs units in Thailand?
As you already know, the first thing you have to do is to create a brokerage account. There, you will find three options.
- You can directly place trades with the help of local SET brokers’ members.
- The trading applications of the foreign trading companies and institutional investors can be connected with the brokerage account with the help of SET member brokers’ front-send systems. This process can be completed by Direct Market Access (DMA).
- You find the retail investors that take help from local or foreign online brokers to trade on the SET.
You can also check the article that explains how to invest in REITs which is written by the Stock Exchange of Thailand.
What are the requirements to set up and run REITs in Thailand?
When you are investing in a REIT account, here are a few key points that worth a read.
- After the unit’s offering, the paid-up capital must be more than or equal to the 500 million THB.
- The unitholders must be paid with a net profit of 90% or more.
- The REIT units or shares you buy must be listed on the Stock Exchange of Thailand.
- REIT investment can be made on any type of real estates such as office buildings, departmental stores, warehouses, malls, and other similar types.
- Domestic and overseas units are included in the investment of REITs.
- Those properties that are generating rental incomes must have more than or equal to the 75% of the total offered value.
- Investment in Greenfield projects that are basically the new properties cannot be exceeded by 10% of the net asset value. For Brownfield projects that are already established, the REITs have to invest 90% of its net assets.
You have to keep in mind that the above-described requirements are general, and other additional rules will be applied as well.
Advantages of investing in Thailand’s REITs:
If you research properly on REITs, you will find that there are a lot of advantages of investing in REITs, not a particular one but in all markets. Given below are some of the major benefits that you can get as a foreigner after investing in the REITs of Thailand.
Access to the Market:
In some cases, making the investment in real estate can be a tricky process, even for foreign investors as well. As described earlier, only 49% of the strata-tilted projects can be acquired by foreign individuals.
Unless you have a local company, as a foreigner, you are not allowed to buy commercial properties in Thailand. But on the other hand, you will have access to all types of properties if you invest in REITs such as office space, shopping malls, warehouses, and industrial real estate. So, you are not bound to invest in those units that generate lower profit as compared to commercial real estate.
Overwhelming Foreign Ownership Restrictions:
When you invest in the real state of developing countries, the process can be complex, and you might face a lot of hurdles which results in a lot of money and time waste. On the other hand, if you invest in REITs, it is comparatively easy and simple. So if you want to get to commercial real estate, then you can easily acquire access to these assets.
Real Estate Ownership’s Substitute:
Investing in real estate needs you to manage the rentals, pay taxes properly, and also take care of maintenance in time. For example, if your building becomes vacant, you might have to face the income shortage of an unknown time period.
In REITs, selling your property is a different thing because you have the agent to do the hard work for you unless you want to do it by yourself. It is because there is a lot of paperwork involved when you are selling a property. You can instantly sell units in REITs.
In recent years, the REIT market of Thailand is considered one of the best performing in Asia. The market capitalization range is 200 to 600 USD. It is, according to the JLL REITs, trade at a 5.6% dividend yield, compared to 6.2% for the Property Funds for Public Offerings (PFPOs).