Mr Pakpoom (fourth from right) and Mr Thongchai (third from right), shake hands to symbolise their partnership in the 14-billion-baht joint venture condo project.

SET-listed contractor Stecon Group has diversified into property development, targeting an initial return of at least 15%, starting with a 14-billion-baht joint venture condo project with SET-listed residential developer Noble Development.

Pakpoom Srichamni, group chief executive and president of Stecon, said the move marked the company’s first venture into real estate development and its fourth investment this year.

“After nearly 50 years in construction, we recognised that relying solely on contracting constrained our growth potential,” he said. “To ensure sustainable expansion, we diversified into power, logistics, transport, startups, new technologies, and now property.”

By the fourth quarter, it plans to sign two joint-venture deals with foreign partners to develop data centres on two sites: its own plot on Bang Na–Trat Road at KM 4.5, and on an investor’s land plot in Chachoengsao’s Bang Pakong district.

Stecon, which posted 30.3 billion baht in revenue last year, almost entirely from construction, has earmarked 2-3 billion baht annually for non-construction investments, aiming for those businesses to generate profits on par with construction by 2030.

The firm notified the Stock Exchange of Thailand on Tuesday that its subsidiary, STECX Ventures Co, acquired a 50% stake in Vertical Rama 9 Alliance 1 Co, a Noble subsidiary developing the Nue Epic Asok–Rama 9 condo project, for 610 million baht.

The project, which recently began piling work, is located on a 15-rai plot on Rama IX Road. It comprises four high-rise buildings with a total of 3,116 units worth 14 billion baht.

Some 60% of the units valued at 8.3 billion baht have been sold. Stecon will handle construction under a 4.4-billion-baht contract, starting in January 2026 and scheduled for completion by the end of 2028.

“We aim for a minimum initial return of 15% from property investments,” said Ekachai Nitasanajarukul, chief strategy and new business officer at Stecon.

“There is no fixed formula for property investment decisions. It depends on the target customer group, price range, and market conditions. What matters most is having a clear marketing strategy,” he said.

Thongchai Busrapan, co-chief executive of Noble, said the sale of its stake in the project is part of an asset-light strategy, enabling the company to reinvest in new developments given the project’s significant value.

“This type of deal is not new. We previously sold a condo project that was still under construction with some units remaining for sale to another developer,” he said. “Sometimes divestment generates lower returns, but it avoids waiting four to five years for construction to be completed.”

The 610-million-baht proceeds from the recent sale of its stake will be booked in the third quarter of 2025 and are expected to help reduce Noble’s debt-to-equity ratio from 2.2 times at the end of the second quarter to below 2 times by year-end.

Noble plans to launch three new condo projects worth a combined 10 billion baht in 2026, with discussions ongoing with Stecon on potential joint-venture participation.

SINKHOLE REPAIR

Regarding the huge sinkhole on Samsen Road last Thursday, caused by construction of the MRT Purple Line (Tao Poon–Rat Burana extension), Stecon’s chief executive said the exact cause remained unclear.

“Preliminary assessment shows the impact is not severe as the damage occurred at the tunnel-to-station junction over a short distance. Our plan is to fill the area, remove the damaged section, and rebuild the affected tunnel,” said Mr Pakpoom.

He said the project has about 30 months remaining on the company’s contract, and Stecon estimates repairs will take less than a year, allowing the joint venture to complete the project on schedule, with repair costs expected to be covered by insurance.

The venture is 55% held by Ch. Karnchang Plc (CK) and 45% by Stecon, with tasks allocated according to expertise — CK handles tunnelling, while Stecon focuses on station construction and related building equipment.

“Under the joint venture, we share responsibility for all work, regardless of which partner leads a specific task,” said Mr Pakpoom.