Thursday, September 21, 2017

Prices surge as speculators flock to Dawei

A young woman cycles along the main road in Dawei, in Tanintharyi Region, on February 8.  (Aye Thidar Kyaw / The Myanmar Times / February 21, 2011)A young woman cycles along the main road in Dawei, in Tanintharyi Region, on February 8.  (Aye Thidar Kyaw / The Myanmar Times / February 21, 2011)

A storm of speculation has driven property prices in Dawei, in Tanintharyi Region, sky-high after plans emerged to build a super seaport and special economic zone there.

The boom, which has pushed up prices to levels rivaling those of Pyay Road, Yangon, began after the long-term, multibillion development plans were announced last October, say local real estate agents. In some cases, prices have now risen to 10 times what they were in September.

Italian-Thai Development, the company developing the 250-square-kilometre site, is said to have already begun planning a 160-kilometre-long road to Kanchanaburi Province in Thailand to encourage further foreign investment. The company signed a 60-year build, operate and transfer agreement with the government on November 2. The enormous project has an expected price tag of US$58 billion.

Most buying has been concentrated in Dawei’s downtown streets and the orchards that lie between the town and the site of the proposed deepsea port at Kappali Bay, the sources said.

The buyers are said to be Myanmar of Chinese extraction from Kachin State and Mandalay who, apparently working together with some local residents, bought about four or five blocks at the same time in the same place, said U Soe Thein, the owner of Soe Thein Real Estate.

One Chinese buyer bought eight blocks on Seventh Street for K4.5 million each, he said.

Until then, sales in the area had been stagnant. “Nobody wanted to buy before, but he said he was buying because of his traditional beliefs,” he said.

The price of those blocks then rose to K10 million, and eventually local residents bought it back from the original buyer for K12-13 million in the hope of further profits from resale to investors, said U Soe Thein.

A Dawei District official said, “It isn’t locals who are buying. It’s speculators with an eye to the future.”

A prime location in the town centre, near the supermarket, hotels and offices, jumped from K100,000 to about K500,000 a square foot, comparable to Pyay Road in Yangon.

“I heard the owners have locked in the price now, because they know they cannot get that place again at that price,” he said.

Some residents dare not sell, fearing the rapid escalation of prices would prevent them from buying another property, sources in Dawei said.

About 4 acres of orchard land went for K30 million three months ago, but now a Yangon buyer is offering K100 million – but the owner refuses to sell, said Daw Aye Nwe, who owns a pomelo orchard between Dawei and Maungmakan beach.

“This orchard represents our family’s livelihood, and we can’t sell,” she said.

Nearby rubber farms have also appreciated in value by about 50 percent, to K17 million for two acres, said Ko Than Htwe, the owner of a rubber farm near Maungmakan. The beach there is expected to be developed into a tourist attraction about 10 miles (16km) from the seaport complex. A 400-square-foot restaurant there changed hands this month for K3 million, when the owner said the site had been valued at only K300,000 in October last year.

A group of ethnic Chinese people from Kachin and the Chinese border appeared in Dawei shortly after the New Year, and are now looking into orchard and farming compounds around the future port, said one local property investor who is holding two or three blocks on the main road.