Over 3,000 new condo units were launched in the fourth quarter, bringing the overall number of new launches to slightly over 10,000 units in 2013 compared to 7,300 units in 2012, a record year for the CBD.
However, a lack of prime development sites will continue to drive demand for top-quality residential products in desirable locations.
The Sukhumvit zone recorded the largest number of new launches with 1,577 units, representing more than half the total in the fourth quarter.
While demand for small and compact condos has been consistently positive over the last two years due to affordable pricing and payment schemes, there is also a burgeoning appetite for larger and more spacious units.
Prime projects, which command exceptional locations and quality, drove average launch prices of super luxury projects up from 193,000 baht per square metre in the first quarter to 225,000 baht in the fourth quarter.
The capital value for resale CBD condominium units rose marginally by 0.3% quarter on quarter and 2.6% year on year to reach an average of 87,400 baht per sq m.
Within the CBD, resale activity in Sukhumvit was particularly high as local homebuyers sought value-for-money purchase opportunities from older secondary properties in good locations.
CBD condominium projects launched in the fourth quarter recorded an average take-up rate of 60%.
Despite dimmer economic performance and declining sentiment in the overall economy, the condo sector managed to attain an absorption level averaging 57% for 2013.
The sector fundamentals remain largely resilient in the medium to long term, supported by the expansion of mass transit routes.
The current stalemate will not have a significant impact on prime development launch prices as the lack of prime sites and strong demand will continue to support the market.
Bangkok's office sector continued to witness strong leasing activity amid lacklustre economic growth and political uncertainty.
The fourth quarter of 2013 saw a handful of tenants move into new spaces, lifting overall occupancy levels in the CBD. The shortage of suitable space continues to make the overall environment favourable to landlords.
With no new supply in the quarter, total prime office stock in the fourth quarter stood unchanged from the previous quarter at 1.7 million sq m.
Occupancy levels in the fourth quarter rose to 91.9% from 90% in the third quarter.
Average rents in the fourth quarter rose by 1.7% quarter on quarter to 700 baht per sq m per month. Lack of office space will constrain major space movements in the coming months.
Prolonged political uncertainties may affect corporate sentiment in the short term and lead to a wait-and-see attitude among businesses.
In the retail sector, the dearth of new large completions in 2013 has limited the amount of large leasing tenancies. Nonetheless, net absorption is likely to pick up with the completion of prominent malls in downtown Bangkok.
Retail developers continue to be keen on greenfield developments in cities.