Bangkok Office Market

Mr. Marcus Burtenshaw, Executive Director, Head of Occupier Services & Commercial Agency, Knight Frank Thailand said that “As we reflect on 2018 and look towards the year ahead, we have seen a widening gap between the rents and occupancy rates of the grade A and C sectors, and expect to see rents continue to climb, even in the face of new supply coming on stream. In a climate of low unemployment, tenants are increasingly viewing their office as a strategic tool to attract and retain one of the most precious resources in the city, talent.

Firms are prioritising the quality and location of their office space, even if they have to pay a little more. They value amenities and design standards that promote a healthy lifestyle and foster a collaborative inclusive working environment, that appeals to a much broader age group.

Firms will enjoy more options in the months and years ahead that will be able to meet those criteria. They say “a rising tide lifts all boats” and rents are climbing across the board, but this trend could also spell trouble ahead for older, outdated properties who will face increasing pressure to modernise.”

Thailand’s economy continues to expand at a solid pace, with the main drivers of growth taking the form of private consumption and investment. Despite the stalling of external demand due to US-China trade tensions, internal growth fundamentals remain strong due to the governmental support for infrastructure investments under the Thailand 4.0 initiative to develop a value-based economy powered by innovation, creativity and technology. Transport infrastructure developments have also reduced logistics costs and increased accessibility to non-central regions. << bangkok office market



A total of 3 new office buildings were completed outside the CBD in Q4 2018, adding 57,878 square meters of new office space. Meanwhile, 56,688 square meters of office space was removed mainly for renovation purposes.Overall, Bangkok office space increased by 1,190 square meters to a total of 4,953,636 square meters.

Total take up for the entire 2018 is 332,810 square meters  a 7% increase from the previous year. Since 2016, total take up has exceeded 300,000 square meters per year.  Grade B office space was marked by a significant increase in take up to 222,790 square meters from 138,692 square meters in the previous quarter. Both Grade A and Grade C quarterly take up declined to 40,313 square meters and 69,706 square meters, respectively.


Figure 1

Supply, Demand and Occupancy Rate, 2013 – Q4 2018

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Figure 2

Bangkok Office Total Take Up by Grade

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Future Supply

In 2019, it is projected that 5 new buildings will enter the market, adding a total of approximately 208,609 square meters of office space. Three buildings with a combined space of 133,000 square meters will be located in the CBD. In the non-CBD areas, 2 buildings will add 75,609 square meters to the existing space.

From 2020 to 2023, 9 projects with office space available will enter the market, increasing total supply by 602,981 square meters. It is expected that almost all pipeline projects located in the CBD will be Grade A quality.


Table 1

Bangkok Office Future Supply (Square Meters)



Table 2

Bangkok Office Future Supply



Figure 3

Bangkok Office Future Supply 2019 – 2023




In Q4 2018, demand for Bangkok office space was relatively consistent with the previous quarter. Net occupied space increased by 1,058 square meters to a total of 4,566,773 square meters, increasing 0.58% Y-o-Y. Meanwhile the overall occupancy rate is 91.57%, declining from the previous quarter but still up 0.25% Y-o-Y. Within the CBD, office spaces in the Ploenchit – Chidlom area enjoyed the highest occupancy rate at 97.21%, having increased by 0.8% Y-o-Y. Outside the CBD, Asoke – Petchburi had the highest occupancy rate at 92.55%, down 0.2% Y-o-Y.

Demand for Grade A office buildings remains strong given the occupancy rate of 95.0%, which decreased by 0.3% from the previous quarter. The occupancy rate of Grade B office buildings also dropped slightly to 93.4% from 93.6% in the previous quarter. Opposing the trend, the Grade C office occupancy rate rose to 88.4%, despite negative growth in the past three quarters.

Net absorption returned to positive at 1,058 square meters for this quarter, following a net absorption of -23,011 square meters in the previous quarter. Given the low level of supply added, this indicates that demand is fairly well matched with supply in Q4.


Table 3

Occupancy Rate by Grade



Figure 4

Bangkok Office Supply – Demand Dynamics



Rental Rates

Mean asking rents increased significantly in Q4 2018 from 745 baht per square meters per month to 765 baht, representing a growth rate of 2.6% Q-o-Q and 6.8% Y-o-Y. In contrast to the previous quarter, Grade A rents experienced positive growth, increasing by 4.7% Q-o-Q and 8.2% Y-o-Y to 1,083 baht per square meters per month.

Both Grade B and Grade C rents also rose 8.7% and 8.4% Y-o-Y to 787 baht and 494 baht, respectively. Q4 2018 marks the 8th consecutive quarter of Y-o-Y rental growth for all 3 office grades.


Figure 5

Bangkok Office Average Asking Rent by Grade


Table 4

Bangkok Office Asking Rent by Grade (Baht Per Square Meters)

Rent by Areas

Asking rents in the CBD are increasing at a significant pace. Leading the way is Wireless Rd., which has the highest average asking rent of 1,120 baht per square meters per month and the highest Y-o-Y growth rate at 27.1%.

The lowest rents are commanded by offices outside the CBD in the Bangna area at 532 baht. Rents in the Asoke – Petchburi area are growing at a rate of 13.3% Y-o-Y, higher than any other area except Wireless Rd. This is possibly due to the area’s close proximity to the CBD and the limited supply of offices added to the CBD in 2018.


Table 5

Bangkok Office Asking Rent by Area (Baht Per Square Meters)



Asking rents will continue to rise, albeit at a slower pace given that over 200,000 square meters of new supply, twice the amount in 2018, is expected to enter the market.

Given that demand levels have remained consistent over the past 2 quarters, the new supply will increase options of high-grade office space to tenants, increasing their bargaining power and compressing rental growth.