THAILAND Law and Practice Contributed by: Olaf Duensing, Jerrold Kippen and Weeraya Kippen, Duensing Kippen, Ltd.
landscape is witnessing a spike in demand for upscale condominiums, particularly in sought after tourist hubs. The surge in Russian buyers, in particular, has bolstered the real estate sector, notably in Phuket. In the commercial office sector, the next two years will see the completion of over 850,000 square metres of office space which will com - pete with an aging office inventory, where more than 60% of current buildings are over 25 years old. Real estate investors, developers and lenders have not yet started to adapt to recent techno - logical innovations such as blockchain, decen - tralised finance (DeFi) and proptech, which have begun to have a disruptive effect in the industry in some other locations. It is therefore unlikely that any such technologies will have any signifi - cant impact on the real estate market in Thailand over the next 12 months and no alternatives to traditional financing are visible in the market. 1.3 Proposals for Reform In Bangkok, a new city plan has been approved by an advisory committee of the Bangkok Met - ropolitan Administration (BMA). Public hear - ings will be held after which the new city plan is expected to be enacted in 2025. Some of the expected changes would be an increase in cer - tain use areas, for example, more areas that can build high-rise condominiums. Also, there is a draft Announcement of the Min - istry of Natural Resources and Environment Regarding Environmental Protection Areas and Measures in Phuket Province (the “Draft”) under the National Enhancement and Conservation of Environmental Quality Act (1992), which is expected to be enacted in May this year.
One of the major limitations under the current environmental law applicable to Phuket is that land above 80 metres from mean sea level is reserved only for activities related to national security, public utilities and environmental con - servation efforts. However, the Draft would ease such limitations by allowing private sectors to develop land above 80 metres but not exceed - ing 140 metres from mean seal level, subject to certain restrictions prescribed by the said Draft.
2. Sale and Purchase 2.1 Categories of Property Rights
There are five main real estate titles. The cha- note is one of only two true ownership titles in Thailand and is issued for land. The second is the Condominium Unit Title issued for a condo - minium unit. There are also three possessory rights title docu - ments for land. In order of preference they are:
• Nor Sor 3 Gor; • Nor Sor 3; and • Sor Kor 1.
Property rights, including transfer of ownership, can only be registered on the chanote , the Con- dominium Unit Title, Nor Sor 3 Gor and Nor Sor 3 deeds, but a Sor Kor 1 can usually be upgraded to a chanote or Nor Sor 3 Gor. Immovable property may be leased for up to 30 years under the CCC, whereas leases for indus- trial or commercial purposes are eligible for a lease term of up to 50 years in some circum - stances. A registered usufruct gives the grantee the right to possess and benefit from immovable property
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