Thai Developer Says Sales to Rebound With Pent-Up Chinese Demand

WHA Corp., Thailand’s largest industrial estate developer, expects sales to rebound next year with a likely easing of travel restrictions and strong demand for land from companies seeking to relocate factories from China.

Sales next year may double to 600 rai (96 hectares) from an estimated 300 rai this year, David Nardone, the group executive for WHA Corp.’s industrial-development unit, said in an interview. The developer, which owns 11 industrial parks across Thailand, saw demand hit by the coronavirus outbreak, which delayed fresh investments, he said.

WHA Corp. is expected to benefit from the trend of global manufacturing companies seeking to diversify out of China because of the U.S. trade tariffs, Nardone said. The Covid-19 pandemic, demand for new supply lines and a tightening labor situation in China will also spur demand for industrial land in Thailand, he said.

“We are seeing half of our business coming from China. There are still huge opportunities from businesses relocating from China,” Nardone said. “We expect a good pace of business by 2021 because of the pent-up demand.”

While some Chinese customers went through a mandatory 14-day quarantine in Thailand to see the land and affiliated facilities before making purchases, only one customer sealed a deal without actually visiting the site, Nardone said.

WHA Corp.’s land sales plunged 78% to 124 rai in the nine months through September from the same period a year earlier even after the company relied more on video calls, drones and satellites to push the business, Nardone said.

Shares of WHA Corp. is down 19% this year, underperforming the benchmark SET index of stocks that’s dropped 9% during the same period.

©2020 Bloomberg L.P.

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