Renovating and restoring old, derelict properties with a view to either selling or leasing is nothing new. However, such a course of action remains one of the most profitable ways to make money in local real estate.

We’ve seen on our screens shows such as ‘Under the Hammer’ which follows people from the day they buy a property at auction through renovation and on to show the finished product. From start to finish a local agent gives insight into how the work has helped to improve the valuation.

Early in 2021 I was involved in such a project. We were constructing a pool villa development and the land alongside contained a derelict condominium. The condo block had been abandoned for 15-plus years and was not only a hindrance, but a nuisance, to people in the area. Several potential pool villa clients raised concerns about living next to a derelict building. As developers, we were aware of these issues and that the building was up for auction. However, we were in the middle of the COVID pandemic which made it difficult to attend any auction. So, it became a waiting game!

Finally, after skipping through many other obstacles, we were able to attend the auction and buy the building. After carrying out due diligence we then had a project with land and a building which we had brought at a reasonable price, enabling us to hit the market with a very competitive price structure, especially when compared with other projects. The derelict condo restoration proved a huge success, selling out quickly and was completed and handed over within 24 months.

With the adjoining pool villa development selling out by September 2022, it was back to the auction and time to study the area for more projects.

Midtown Villas

This project was one I had been aware of for many years – townhouses in the centre of Pattaya that had been started but never completed – another challenge.

I had been involved in attempting to broker the land to a large condominium developer some 12 years previous. That never materialised due to the land already having a residential housing license (not a condo one). This left the owner stuck with a large plot she was unable to sell, unless the buyer was willing to complete the housing development.

The original plan was for 89 townhouses, of which 32 had already been built. After more due diligence we discoved we could amend that plan and introduce house designs. Thus Zensiri Midtown Pool Villas was born.

Zensiri Midtown consists of 25 luxury pool villas in the heart of central Pattaya. The plot is possibly the last parcel of land in such a central area that will ever allow such a development.

While researching and looking for derelict projects or ones in limbo and un-finished, I was surprised at how many of these were in ‘prime’ locations.

Now, you may ask: Why not just buy the land and start a new condo or villa project and save all the headaches and hassle of taking on someone else’s existing problem? My experience is that, in many cases, with pre-existing projects the real headaches have already been encountered and overcome.

Today, it can be a real challenge for developers to get  development and construction licenses. Taking a ‘greenfield’ site and starting from scratch is time consuming, but, more importantly, it can be very expensive.

The hoops we have to jump through to get designs approved, following IEE and EIA regulations deal with local authorities – water, electric and waste disposal are all major issues and cost money, money and more money! More often than not existing projects have already gone down such roads, making it  simpler to pick up the pieces and getting the ball rolling again.

For 2024, I’m hoping at that we at ESS Developments can breathe new life into more similar projects. I see the local real estate market as being in in a very strong place with sales in both villas and condos buoyant.

www.essdevelopments.com