There are several types of industrial real estate in Thailand suitable for foreign investors and companies. It is important to understand the specifics of each type as well as the legal restrictions involved.
Legal Aspects of Land Ownership by Foreigners
Under Thai law, land can only be purchased by Thai companies or companies in which the majority ownership belongs to Thai nationals, with two exceptions:
- A wholly foreign-owned company may purchase land within an industrial estate regulated by the Industrial Estate Authority of Thailand (IEAT).
- A wholly foreign-owned company with privileges granted by the Board of Investment (BOI) may purchase land anywhere in Thailand, provided it is used exclusively for manufacturing purposes.
Types of Locations for Establishing a Business
Industrial Estates
Industrial estates refer to land plots and facilities developed and managed in cooperation with IEAT.
Advantages:
- Foreign companies with BOI privileges may own land 100%
- Cooperation with IEAT simplifies obtaining construction permits and licenses
- Thailand has approximately 29 industrial estates under IEAT supervision
Industrial Parks and Zones
Industrial parks are developed and managed by private companies without IEAT involvement.
- Foreign companies may purchase land only if they have BOI privileges
- No access to IEAT incentives
- Infrastructure quality and management depend on the developer
- Investors must rely on the developer for assistance in obtaining construction permits
Greenfield Suburban Land
These are undeveloped suburban land plots intended for companies with BOI privileges.
Disadvantages:
- Additional costs for land preparation and infrastructure connections
- Possible difficulties accessing utilities
- Requirement to obtain multiple permits from various government authorities
- Lower initial land cost, but higher overall development expenses
Comparative Table for Land Acquisition
| Feature | Industrial Estates | Industrial Parks & Zones | Greenfield Land |
|---|---|---|---|
| Can a BOI-promoted foreign company own land? | Yes | Yes | Yes |
| Can a non-BOI foreign company own land? | Yes | No | No |
| Assistance with permits | Yes | Yes | No |
| Assistance with utilities | Yes | Yes | No |
| Suitable for export-oriented production | Yes | No | No |
Additional Types of Industrial Real Estate
Warehouses and Distribution Centers
The market offers a limited number of warehouses and distribution facilities. These are typically single-story buildings with floor load capacity of 2–3 tons per sq.m and ceiling heights of 6–8 meters. Most of them are not equipped with loading docks.
Build-to-Suit Construction
Some developers offer custom-built warehouses or manufacturing facilities tailored to investor requirements. These projects can be located in industrial estates, industrial parks, or on greenfield land.
Author: Alexandra Agapitova.
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