With its fascinating mix of old and new, Yangon is one of Asia’s most interesting real estate markets. Now that Myanmar is opening up and entering the modern world that mix hangs in the balance and the city is changing on an almost daily basis. Verity Ramsden of Yangon real estate agency Slade Property Services discusses the key issues affecting Yangon’s transition from colonial gem to bustling Asian metropolis.
Heritage property in the limelight
Yangon is famous for its heritage properties, but many of them have lain unloved for decades, not being put to good use. The last year has seen a number of high-profile renovation projects seek to reverse that trend. The conversion of the former Burma Railways headquarters building into a luxury hotel as part of the Landmark development is now well underway, following the developer’s successful application for a leasehold extension for the site. The beautiful and impressive former Police Commissioner’s Office is also being given a new lease of life in the hospitality sector, as the location for a Kempinski hotel.
On a smaller scale, restaurants such as Sharkey’s have undertaken stylish renovations of downtown premises, and a small number of renovated residential apartments for rent have begun to appear, commanding a rental premium for their age and character. If the government and people of Myanmar work hard to preserve their heritage, it seems likely that schemes of this type are just the beginning, and that a great deal of money could be made from this type of Yangon property.
Whereas until recently, real estate development had been something of a free-for-all, with very few planning rules and even less enforcement of those rules, we have begun to see the government and Yangon City Development Committee (YCDC) take much more of an active role in policing Yangon property under development. 2015 saw the suspension and eventual relocation of the Dagon City project, with the President stepping in to assuage fears of buildings being either too tall and blocking views of the Shwedagon Pagoda, or having too many basement floors and undermining the pagoda’s foundations. Certain YCDC officials have also begun to take a tough line on height restrictions, claiming that they will force projects flouting these rules to be halted or cancelled.
Infrastructure projects taking shape
ver the last two years, Yangon has seen an explosion of new infrastructure projects, which change both the look and the functionality of the city. Another flyover recently finished at Kokkine junction, and two more are soon to complete at 8 Mile and Tamwe junctions. Future plans also include a pedestrian underpass on Pyay Road near Yangon University, plus new bridges across the river to the south and south west of the city centre. Finally, a new airport terminal is nearing completion, accompanied by a complete makeover of the airport road and car parking.
More scrutiny and accountability for big-scale projects
Despite the recent fashion for large-scale infrastructure projects in the city, the incoming NLD government is not committed to continuing this trend unconditionally, and favours an attitude of scrutiny and accountability when approving large-scale projects. They recently announced that two planned flyovers, at Parami junction and at North Okkalapa junction, due to cost over $26 million, are to be reassessed, and their business case reassessed. Similarly, it is likely that we will begin to see the new government looking into land ownership issues in the near future, and possibly even repeal tenders awarded under previous administrations if it believes them to have been awarded unfairly or at an unrealistic price which does not provide the people of Myanmar with good value for money. This may cause some upsets, but could potentially regularise land ownership and make it less of a minefield than it is currently.
It remains to be seen how these trends will affect Yangon, and Yangon real estate, in the long term. One thing is for certain, though; it is an exciting time to be involved in this wonderful city, and with support from an experienced Yangon real estate agency such as Slade Property Services, prudent investors can benefit from the great opportunities available whilst also helping to shape the face of the city for years to come.
ABOUT THE AUTHOR:
Verity Ramsden is a Chartered Surveyor with over 5 years of real estate industry experience in the UK and Myanmar. She joined SPS in February 2015 and heads up the Valuation and Advisory Department, providing clients with real estate consultancy on assets in Yangon, Mandalay, NayPyi Taw and beyond.