CG Capital Lines Up Second Phuket Mixed-Use Scheme

Foreign buyers tracking Phuket will have a new branded mixed-use scheme to weigh within the next two months, as CG Capital Advisory, the private equity arm of Central Group, readies its second hotel-and-residential project on the island. The move signals continued conviction from one of Thailand's most established retail and hospitality conglomerates that Phuket's current cycle still has runway, particularly at the upper end where international purchasers dominate the buyer pool.

CG Capital's expansion strategy follows a familiar template for Phuket's maturing market: pair a hotel operator with branded residences on a single site, allowing buyers to combine lifestyle use with rental yield through a managed letting programme. The format has been popularised on the west coast by global hospitality groups and adopted by Thai developers seeking to compete on service standards rather than price. For buyers from Hong Kong, Singapore and the Gulf, who form a significant share of Phuket's premium villa and condo demand, the mixed-use structure offers a clearer exit and a more predictable income profile than standalone freehold units.

Phuket's residential market has run hot since travel reopened, with foreign purchaser numbers reaching levels not seen since the pre-2014 cycle. Russian buyers led the early post-pandemic wave, joined more recently by Chinese, Indian, European and Middle Eastern buyers diversifying away from softer markets at home. Land prices in Bang Tao, Layan, Cherng Talay and Kamala have moved sharply upward, pushing developers toward denser, vertical formats and toward mixed-use sites that can absorb higher land costs through hotel revenue.

Central Group's own footprint on the island is already substantial. The conglomerate operates Central Phuket, the dominant luxury mall in the island's commercial centre, and has long-standing hotel interests through Centara. CG Capital's role is to take equity positions in development plays that align with the group's broader retail, hospitality and lifestyle ecosystem. A second Phuket project so soon after the first suggests the team sees room to add inventory without saturating the segment, particularly if pricing remains anchored to international rather than domestic affordability.

For foreign buyers, the practical considerations are familiar but worth restating. Condominium units in Thailand can be held freehold by non-Thai buyers within the 49 per cent foreign quota of each building. Villas and landed homes typically require a long-leasehold structure, usually 30 years with renewal options, or a Thai-majority company holding. Branded residences inside a hotel-led mixed-use scheme almost always sit on the condominium side of that line, which is one reason the format has proved popular with overseas purchasers seeking clean title.

Location will be the determining factor for the new project's positioning. The Bang Tao and Cherng Talay corridor on the northwest coast has emerged as Phuket's most active luxury submarket, anchored by Laguna Phuket and a cluster of international school, marina and wellness developments. The Kamala and Patong axis remains the higher-volume hospitality belt. Rawai and the south continue to attract long-stay residents and retirees rather than rental-yield investors. Each submarket draws a different buyer profile, and developers increasingly tailor unit mixes accordingly.

The broader question is how much further Phuket pricing can run before yields compress to the point of pricing out income-focused buyers. Average gross yields on managed condo units on the island sit in the five to seven per cent range, comfortably above Bangkok prime but below the headline numbers some sales offices quote. Currency is also a factor: a stronger baht through 2024 and into 2025 has trimmed effective returns for buyers funding in US dollars or Hong Kong dollars, though the Thai unit has eased modestly in recent months.

What to watch when CG Capital's second project opens for sale is the operator partnership, the unit-size mix and the rental programme terms. A recognised international hotel flag, a balance of one- and two-bedroom inventory, and a transparent revenue-share structure are the markers serious foreign buyers now expect on Phuket. Anything less risks getting lost in a market where branded supply continues to multiply and where buyer due diligence has visibly sharpened.