Netherlands Embassy puts prime 20-rai plot up for diverse development

Embassy land in Thailand that has been held for many decades is often made up of large plots in prime locations. In the past, these sites may have been outside the city or away from central districts, but over time urban expansion and the development of infrastructure have transformed their potential.

As Bangkok has grown, the city’s inner areas have changed significantly. CBD and commercial districts have shifted and expanded, and many embassy sites in Bangkok have consequently become large landholdings located within the CBD or in the inner city.

The way embassies conduct transactions and handle documentation has also changed. Embassies no longer need large land plots or the same volume of staff as in the past. As a result, many have decided to sell, reduce the size of their premises, or move into office buildings instead of occupying extensive standalone compounds.

Embassy personnel also no longer need to live on embassy grounds. Over the past several years, a number of embassy sites have already been sold.

Most recently, the Netherlands Embassy announced the sale of a plot of more than 20 rai (19 rai, 3 ngan and 26.6 square wah) on Wireless Road, with additional access via Soi Ton Son. 

According to an analysis by Surachet Kongcheep, head of research and consultancy at Cushman & Wakefield Thailand, this is the latest embassy-owned plot to be offered for sale and it is a very large site in a location where land prices are already exceptionally high.

Its potential becomes even clearer when considered under the preliminary provisions of the draft Bangkok Comprehensive Plan (fourth revision), which is expected to come into force in 2027. The plot falls within a red zone designated for commercial use, meaning it can be developed into any type of real estate project, or potentially into a large mixed-use scheme.

Given the size of the site, any interested investor would almost certainly avoid developing a single-use project on the land. In addition, Wireless Road has a road reserve width of more than 16 metres, meaning there are effectively no restrictions on the types of property development that can be pursued.

The plot also has a floor area ratio, or FAR, of 10:1, the highest permitted under the draft Bangkok Comprehensive Plan (fourth revision), and an open space ratio, or OSR, of 3.5, the lowest specified. This means the site has the highest development potential under the draft plan.

A wide range of property projects could be developed on the site, although the price is also likely to be substantial. The most recent sale of a similarly sized plot was the former British Embassy site, which was auctioned for around 2.2 million baht per square wah.

Like other embassy sites sold previously, the Netherlands Embassy land will also need to be auctioned. However, the timing may make this a particularly capital-intensive investment compared with earlier embassy land auctions, especially given that the plot is larger than 20 rai.

Using the former British Embassy price of 2.2 million baht per square wah as a benchmark, the Netherlands Embassy site would have a total value of about 17.43 billion baht. 

That would likely leave only a small number of investors in Thailand with sufficient financial strength and the capability to develop a major mixed-use project, meaning the future of this site will need to be watched over the longer term.