It may not be Myanmar’s golden era for residential real estate but headwinds in the market have compelled builders to find areas of opportunities in other segments, achieving some critical and financial success.
Developers are determined to stay afloat after property values went down 10 percent to 30 percent from 2014. In Mandalay, property prices have plunged by as much as 30 percent over the past five years.
Local and joint venture companies are now diversifying across segments amid weakening sentiment. Golden City, one of the recently completed luxury condominium projects in Yangon, has expanded to include a four-storey office tower, Golden City Business Centre.
A project by Singapore-backed developer Golden Land Real Estate Development Co., Ltd., it’s an instant hit, renting out 70 percent of units upon opening last year, and now it has won the Best Mixed Use Development gong at the 2018 PropertyGuru Myanmar Property Awards.
More: Winners of the PropertyGuru Myanmar Property Awards 2018
Builders have also broadened their horizons to cater to an unlikely source: academic institutions. This year’s winner of Best Educational Development is a new campus of Dulwich College Yangon set within the award-winning Star City project by developer Yoma Strategic Holdings.
With rising land acquisition and construction costs, some developers have turned their attention from new build to remodelling heritage structures from the British colonial era. KT Group’s painstaking efforts to restore The Pegu Club did not go by unnoticed; it has been named this year’s Best Renovated Property.
Experts believe that a key ingredient of a market turnaround is the civilian government’s loosening of foreign investment regulations, which could prop up the decelerating property sector.
More: Building sector triumphs at the annual PropertyGuru Myanmar Property Awards 2018
“The updated Myanmar Investment Law and the new Companies Act should significantly improve the environment for business and investment in this country,” said Richard Emerson, chairman of the judges at the Myanmar Property Awards.
With clearer mortgage laws in the offing, the overall recovery of the market could also hinge on the arrival of Fast Moving Consumer Goods (FMCG) and logistics companies looking for operational space.
Colliers predicted earlier this year that the industrial sector would be a “star performer” as competitors such as China and Vietnam raise labour costs, and potential tenants were willing take a “fresh look” at Myanmar despite inadequate infrastructure.