Guide to Starting a Real Estate Company in Thailand: Key Requirements and How to Establish 

Understanding Thailand’s Real Estate Market

Key Trends and Opportunities for Foreign Investors

Thailand’s real estate market is driven by rising demand across several sectors. With rapid urbanization and a growing economy, it’s now an emerging destination for foreign investors in several key segments:

1. Residential Real Estate– Over the recent years, Thailand has seen a surge in foreign investment, particularly in condominium developments. Despite foreign ownership restrictions, cities like Bangkok, Chonburi, and Phuket are prime destinations for investors, retirees, and digital nomads.

2. Commercial Real Estate: Rise in mixed-used developments, office spaces, and retail centers in key cities like Bangkok and Chonburi. Investors are drawn to areas catering to business hubs and expatriate communities.

3. Industrial Real Estate: Special economic zones like the Eastern Economic Corridor (EEC) drive demand for industrial properties, including factories, warehouses, and logistics hubs. These zones benefit from significant government incentives and ongoing infrastructure development, making them highly attractive to investors.

4. Hospitality and Tourism Real Estate: With over 40 million annual visitors, Thailand’s tourism sector fuels demand for hotels, resorts, and vacation properties, particularly in hotspots like Phuket and Krabi.

Foreign Participation in Thailand’s Real Estate Sector

The Land Code Act, legally prohibits foreigners from directly owning land in Thailand. However, there are specific avenues and exceptions that allow long-term land use or indirect ownership in certain circumstances:

1. Condominium Ownership– Under the Condominium Act, foreigners can own up to 49% of the total unit space in a condominium project, making condominium developments a popular choice for foreign investors.
2. Long-Term Land Leases– As per the Thai Civil and Commercial Code, and Land Code Act, foreigners can lease land for up to 30 years, with options to renew for additional 30-year periods.
   • Note that while this structure allows you to control land for long-term projects, it does not confer full ownership rights.
3. Private Limited Company– You can indirectly own land by forming a Thai limited company, where foreigners can hold up to 49% of the shares. Thai nationals must own the remaining 51%, and the company structure must comply with the Foreign Business Act (FBA) to avoid nominee issues.
4. BOI-Promoted Companies – Real Estate companies involved in priority sectors such as smart city development or green construction may qualify for incentives from the Board of Investment (BOI). This includes land ownership rights for project purposes and tax benefits.
5. Joint Ventures– Partnering with Thai businesses allows indirect land control but requires compliance with the Foreign Business Act (FBA) for proper structuring. A well-planned joint venture can offer flexibility and mutual benefits for both parties.

Do You Need a Real Estate License for Your Thai Real Estate Company?

There is no universal real estate license in Thailand. However, depending on whether your real estate activities fall under the FBA, you must secure different permits and certifications. Following are the key permits and considerations for foreign businesses seeking to operate within Thailand’s real estate industry:: 

1. Foreign Business License (FBL): Issued by the Department of Business Development (DBD), the FBL is required if foreign ownership exceeds 49%. It is also mandatory for restricted real estate activities such as land trading, property development, or residential land ownership under the Foreign Business Act (FBA).

2. Property Allocation License: Land subdivision projects must secure a Property Allocation License from the Department of Lands. This is required for projects dividing land into 10 or more plots. Additionally, a building permit from the local municipal office is mandatory for any construction activities.

3. Real Estate Brokerage: While there is no mandatory national license for real estate brokerage, certifications from the Real Estate Broker Association of Thailand (REBA), Thai Appraisal Foundation (TAF), and the International Real Estate Federation (FIABCI) are highly regarded and can enhance your company’s credibility in the industry.

4. Additional Approvals: In addition to the above, you’ll need specific permits or certifications based on your business focus, such as:

• Industrial Estate Authority of Thailand (IEAT): Required for businesses operating in industrial estates or zones.
• Thai Industrial Standards Institute (TISI): Required for real estate developments that meet specific industry standards such as construction or building materials.
• Environmental Impact Assessment (EIA) or Initial Environmental Evaluation (IEE): For large-scale projects with potential environmental impact.

Keep in mind that Thai authorities actively monitor foreign real estate companies to enforce compliance with local regulations. Failure to secure the proper licenses and permits can result in fines, business delays, or suspension. Emerhub’s compliance specialists can help you secure and manage the required licenses tailored to your intended real estate activities.

How to Set Up a Real Estate Company in Thailand

Setting up a real estate company in Thailand as a foreign investor can take anywhere from a few weeks to several months, depending on your level of compliance and intended activities. Below are the key steps involved which Emerhub incorporation experts can initiate in your stead:

1. Real Estate Company Registration with the DBD– The first step is choosing the most suitable legal structure for your real estate business. Depending on your specific business plans, our local experts can guide you through the best options:

• Private Limited Companies: This is the most common structure for foreign investors, allowing up to 49% foreign ownership, unless exempt under the FBA. 
• BOI-Promoted Companies: Offers up to 100% foreign ownership provided you operate in BOI promoted sectors such as industrial estates or innovation-focused projects. Remember, the approval process can be lengthy and it is common for companies to first register as a private limited company and then apply for sponsorship.

We can initiate the registration process with the Department of Business Development (DBD) and ensure all mandatory documentations are in order.

Note that foreign-owned companies must also have a minimum registered capital of 2 million THB (about USD 58,000). If your business activities require FBA compliance, the minimum capital requirement increases to 3 million THB (about USD 87,000).

2. License Procurement and Renewals– As mentioned above, you’ll need to obtain sector-specific licenses, such as the Foreign Business License (FBL) and the Property Allocation License. Emerhub simplifies this process, managing the application and renewal of licenses to ensure your business remains compliant at all times.

3. Corporate Bank Account Setup– A corporate bank account is vital for managing your financial transactions, tax payments, and other fiscal obligations. Emerhub can facilitate the entire process, ensuring your account is set up with a trusted Thai bank to support seamless operations.

Set up your real estate company in Thailand with ease. Reach out via the form and we will put you in touch with our local experts!