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Pitfalls and Perils of Commercial Office development in Bangkok

Following on from our “How we do things series” and the recent publication of our free Estimating Tool, we have decided to take things a little further and offer a guidance pack for Commercial Office development in Bangkok.

We have discovered over the years that many of the corporate businesses that are considering setting up an office in Bangkok may not be fully aware of the approaches available to them. Furthermore, they may not be aware of the local idiosyncrasies in working practices or indeed, in the case of smaller team-structured businesses, may not have any experience in design and build at all.

In response to this situation we have developed a standard schedule of works that highlights the key stages in the process, and a risk management template that highlights some of the key risks and possible mitigation strategies for corporate office set up in Thailand. These tools are available here (registration required).

Different businesses will approach an Office development in different ways, from our experience in Bangkok, the approaches generally fall into three types:

  1. the business will engage (or already has engaged) a global property agent or a large corporate design practice for the full ‘one stop shop’ service;

  2. the business will undertake a competitive tendering approach, whereby the client will either engage a local Project Manager or use their own team and standard procurement procedures to identify local suppliers to tender; or finally,

  3. the business will approach directly a dedicated turnkey provider or local design firm that offers turnkey / design and build.

Each of these three approaches has its pros and cons that should be thoroughly explored prior to pursuing any particular direction. Not only are there the usual risks to consider when entering a design and build project, but there are also risks associated with local team knowledge and experience (of the pitfalls and perils) that would not perhaps be immediately obvious to an overseas business or investor.

The purpose of our guidance pack is simply to provide a framework for managing a project more effectively, by providing a Standard Workflow Schedule and a Risk Management Template.

We believe that should any interested party care to review our documents they would likely find themselves somewhat more prepared to enter into an office development project in Bangkok, than perhaps they would if they just jump in.

The Standard Workflow Schedule

This document is a MS Project file that lists the key tasks in the process, milestones and typical durations from our experience. We link the WBS numbering to the risk management template, to highlight the risks and possible mitigations strategies by task or stage.

The Risk Management Template

This document highlights particular hazards by tasks (as defined by the Standard Work Schedule). The hazards are ranked in relation to likelihood of occurrence and impact if the hazard materialises, giving a High, Medium and Low score for the risk within each task or stage.

The risk is assessed and a potential mitigation strategy is proposed, the risk is then re-assessed on the basis of the mitigation being undertaken.

Finally, there is much to say about the specific idiosyncrasies of working and setting up in Thailand but we have tried to keep this article as short as possible. You will find, however, a good description of the issues within the Risk Management Template, along with some of the pros and cons of each of the three approaches highlighted earlier.

Happy reading, please do reach out to us for help as appropriate.

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