ORIGIN & JWD Launch New JV To Penetrate Industrial Property, Aiming To Be Top3 With Over 12Billion-baht REIT Value in 5 Years
Origin Property Public Company Limited and JWD InfoLogistics Public Company Limited jointly kick off “ALPHA”, a new joint venture company specialized in industry property. The new JV targets to be in top 3 companies within 5 years with a total of over 1 million square meter spaces in factories and warehouses and a total REIT value of more than 12 billion baht. It plans to gain market shares in domestic and overseas particularly in Vietnam, Indonesia and Cambodia by focusing on customers in cold storage, healthy products, chemical and dangerous goods, and automation. The first project will be in Bangna, starting in Q2/2021.
Mr.Peerapong Jaroon-ek,Chief Executive Officer of Origin Property Public Company Limited (ORI), says that ORI and JWD InfoLogistics Public Company Limited (JWD) have set up a 50:50 joint venture company, named Alpha Industrial Solutions Company Limited to serve a surging demand for industrial property. The joint venture between ORI and JWD can generate synergy effects under the “ALPHA” brand.
“We have expertise in land sourcing and cost management in project development. Our partners are the leading real estate developers from Japan and South Korea. Additionally, we have a strong customer base in B2C business. Meanwhile, JWD has specialized in warehouse management and logistics management services. It has a strong network across ASEAN and a broad customer base in B2B business. This collaboration will create a synergy to serve the demand from both B2B and B2C customers. We are confident that our strengths will turn ALPHA into a listed company within 2025 and become one of the top 3 companies in this business within 5 years,” says Peerapong.
Mr.Charvanin Bunditkitsada, Chief Executive Officer of JWD Infologistics Public Company Limited (JWD), adds that ALPHA will focus on three core businesses, which are 1. Industrial Property, for example, warehouses, logistic centers, industrial parks, industrial estates, warehouse management, and order fulfillment 2. Urbanized Property, for example, rental of self-storage units in condominiums and housing estates, and micro-fulfillment center 3. Property Services, for example, energy management, waste water treatment and construction.
“Demand for logistic solutions in Thailand has surged continuously and their demand has become more complex and more specialized. Therefore, JWD and ORI try to create total solutions and differentiate them from the existing solutions in the market. We do not just source the land for warehouse development, but we provide all the infrastructure, software, automation system, robot and other complex services to B2B customers in several businesses. Meanwhile, we create new experiences for customers in residential projects by enabling them to run e-Commerce business from their homes more conveniently. All three businesses will give end-to-end solutions to all logistics-related demand,” cites Mr.Charvanin.
By 2026, ALPHA aims to manage more than 1 million square meters of space in factories and warehouses and the REIT value worth 12 billion baht. Moreover, it will consider forming a real estate investment trust (REIT) to sell the assets to investors within 2023.
Mr.Patan Somburanasin, Managing Director of Alpha Industrial Solutions Co Ltd, says that the fast-growing e-Commerce and food delivery businesses during the COVID-19 pandemic, the government’s policies including the Eastern Economic Corridor and electric vehicle production promotion, and high demand for urbanized property have continuously driven demand for industrial property. With the advanced solutions, the company has six customer target groups comprising 1. e-Commerce 2. Industries that require cold storage, for example, food, drugs, and electronic parts 3. Chemical and Dangerous Goods 4. Automobile and EV 5. Urbanized Property and 6. Data Center.
In the first five years, it will expand its additional space by 2 ways including 1. Organic Growth develop new space management of 120,000 square meters per year or around 60% of its expansion. 2. Inorganic Growth acquiring new space management of 80,000 square meters per year through mergers and acquisitions (M&A) or around 40% of its expansion. It considers the growth in several segments and locations, which are 1. Industrial Clusters in Bangna, Laem Chabang, Rayong and Wang Noi 2. Regional Clusters in the Northeast, the South and the North of Thailand 3. CBDs in Bangkok and CBDs in other big cities and 4. Overseas markets in the neighbouring countries including Vietnam, Indonesia and Cambodia.
“We will first focus on the high-demand locations, for example, Bangna-EEC. To tap into overseas is not difficult because JWD has its businesses and partners in Vietnam and Indonesia. Therefore, we should be able to accomplish our target in terms of both organic growth and inorganic growth to occupy one million-square-meter spaces in factories and warehouses,” says Patan.
The company will start the first development, named ALPHA Bangna KM.22, on the 24 rais of land on Bangna-Trad KM.22 road. The project is a 23-meter-high multi-temperature cold storage, which is Thailand’s first temperature-controlled fulfillment center with automated storage and retrieval system (ASRS) on the space of 22,000 square meters. It offers flexibility in logistic management and modern cold storage and automation system, which provides its customers high efficiency and high safety while saving maintenance cost and energy cost. The project will start the construction by the end of the second quarter this year and generate revenue in the second quarter next year
Origin Property PCL operates three core businesses comprising 1. Residential Development Business. It has developed 86 housing and condominium projects with a total value of over 134 billion baht under PARK ORIGIN, The Origin, KnightsBridge, Notting Hill, Kensington, Hampton and BRITANIA brands 2. Recurring Income Business. It develops and manages hotels, serviced apartments and retail spaces. 3. Service Business. It offers property management, property agent and consultancy services with a vision to expand into other businesses continuously and become a fully-integrated property developer.
JWD InfoLogistics PCL provides end-to-end logistics and supply chain solutions in eight countries in ASEAN. It manages a total of more than 2 million square meters domestically and internationally. Its core business is logistics. It has expertises in warehouses and logistics management that require specific skill, for example, cold storage, temperature-controlled goods, and automobile and auto-parts. It also has other businesses including food business, IT solutions and investment business.