Mar 13, 2012 | Comments 0
In 1899 the great King Chulalongkorn set his planners to work on Ratchadamnoen Avenue, laid out as a grand Parisian-style boulevard and a bridge between the “old Siam” of the Grand Palace and the “new” of Vimanmek.
The city had other ideas though, with its commercial heart developing to the east.
But the pitfalls of history hold no fears for Tonson Property, the development arm of the Tonson Group as it pursues its own grand vision that would see the scruffy waterside district of old warehouses and docks on Rama III road become a new economic, residential and cultural hub.
“There will always be pessimists,” a senior Tonson Group figure says, “those who prefer to stand still, to consider the size of the obstacles and to catalogue the difficulties they believe may make a more ambitious approach impossible.
“But if you want to move forward at some point you have to be confident in your vision and put your shoulder behind the task in hand – to stop thinking and start doing.”
The Tonson Group was only founded in 2006 by Chachchon Ratanarak but his family group companies were among a number of investors who took an early interest in the area.
Bank of Ayudhya’s headquarters were moved by the family to Rama III in the late 1990s. Another family company, Eastern Star Real Estate, has developments in the area.
Tonson’s vision is to see the Rama III riverside transformed fundamentally through a series of phased developments that would bring world class design and new cultural and lifestyle facilities to rejuvenated neighbourhoods. There is even the germ of an idea to create a cultural centre akin to London’s Southbank here, bringing much-needed musical and theatrical facilities to the capital.
The first results of this vision are already on display at the Sathu Residences, which were launched on the market earlier this year. It is a small start but an exclusive one, comprising just 17 residences starting at 256 square metres.
While Chachchon seldom speaks to the media, we were able to catch him for a brief conversation on the margins of a recent event in Bangkok.
He is proud of the build quality of Sathu Residences, with its attention to detail: coated double-glazed windows that reduce heat and eliminate traffic noise, solid full height walls between units stop any disturbance from noisy neighbours or from the common areas and a paved road that runs around the full perimeter of the building to provide unrestricted access to emergency vehicles. The building has flood and even earthquake protection measures. Few of these features have been adopted at other leading Bangkok developments.
“The reason is not the expense,” says Dr Sarakorn Gerjarusak, a director of Tonson Property and a managing director at UBS in Hong Kong.
“Striving for outstanding quality doesn’t have to mean higher construction costs.”
Indeed, The Sathu is on the market at roughly half the price per square metre of similar developments in Bangkok.
“Much more, it means making everyone involved in the project share a common desire to achieve exceedingly high standards,” Dr Sarakorn says. Tonson is not deterred by sceptics who doubt its vision and says there are three reasons behind the focus on Rama III.
The area is among the least crowded of Bangkok’s central districts with access to the amenities of the city centre but without the congestion or the towering concrete viaducts of the BTS that blight other districts.
Existing development is at a very low-density and there are wide roads and long stretches of undeveloped riverfront, he says, and the location is one of the best in central Bangkok for commuting by car.
Located at the intersection of two expressways, the eight lane Rama III road is rarely congested and is just a short drive to Sathon, Silom and Sukhumvit.
The new Bhumipol Bridge is one of a number of investments in transport infrastructure approved by the government has approved invest – a catalyst in the Docklands project in London, which overcame early teething problems to become a commercial rival to the financial district of the City and the site of some of the most sought-after residential projects.
But Tonson does not plan to execute its grand vision alone and others are already playing a part to raise aspirations for the future of the district.
Tonson has produced a CGI rendering of a deliberately visionary and futuristic Bangkok skyline studded with glass spires.
The company says the imagined skyline is inspirational rather than illustrative and as such creates an immediate sense of what can done, pushing at the boundaries that Chachchon says are too often be accepted as the limits of the possible for Bangkok.
There are signs that this district on a previously forgotten reach of the river is attracting wider interest.
Supply in the area totals just over 16,329 units launched from 2003 to the second quarter of this year. The pioneer developer in the area, LPN Development, has a market share of approximately 40 per cent of the total supply. But most of the projects developed by LPN target lower income buyers.
During the first half of 2011, there were approximately 1,400 units added in this area with a take-up rate around 85 per cent.
Tonson points to signs of growing interest in the commercial side of the district. Two other major banks, Krung Thai Bank and Bangkok Bank, are among those businesses to have acquired plots of land for potential new offices and there is continuing discussion of the area as “the future Wall Street of Bangkok”, Dr Sarakorn says.
For Chachchon, an important part of Tonson’s role is to elevate the ambition of the companies it invests in, installing in each a clear belief in the possibility that they can be among the best in the world.
Three generations ago the Ratanarak group started as a small shipping business. It was one of only eight business groups in Thailand to survive in the top 40 after the 1997 financial crisis and today the group includes businesses worth some US$12 billion.
Similar family run business groups have faced natural constraints and a particular challenge as they pass from one generation to the next.
“No trees can grow to the sky”, is a local saying that captures the experience of other Asian business groups that have struggled for longevity.
Despite this, the Ratanarak group has managed to navigate a successful path through the obstacles and opportunities of the past 70 years.
And Chachchon says that a clear vision of the future and the patience and resources to take a long-term view is key to that survival. Indeed the Ratanaraks, he proudly points out, have a track record as successful pioneers in many of Bangkok’s now prime locations. They were for example among the first developers on Ploenchit Road.
Only one question remains, will Bangkok that has resisted so many attempts to impose order on its sometimes anarchic development, see it the Tonson way?