Adaptation Strategies to COVID-19 Impact on Business of the Set- Registered Real Estate Development Companies in 2020

Abstract

The study examines the adaptation strategy of real estate development companies in response to the COVID-19 pandemic during the year 2020. The spread of the pandemic has directly impacted the real estate business causing significant sales decrease in the top business group of the Stock market, which resulted in the needs for adaptation strategy in order to stay in business.  The research has gathered information from 28 real estate companies on the Thai stock market, which are further divided by their total assets into three categories, large, medium, and small business. Information regarding adaptation strategy are further gathered through the news during the pandemic by analysing noteworthy news stories and comparing the old strategy to the new.

The 3 main findings of the study are the following 1) The spread of COVID-19 has decreased both demand and supply of real estate. The lockdown policy has further slowed down the economic growth of both the domestic and international market. Additionally, the deriving uncertainty caused income instability which, in turn, made people more cautious to spend. By decreasing purchasing power of the general populace, the operation and income of these companies are impacted. 2) The study has found that there are 5 main categories in which companies adapt which are strategic, marketing, finance, operation, and the preventative measure for COVID-19 pandemic. Of all the measures, it was found that marketing and strategic adaptation accounted for more than half of the measures chosen by these companies. 3) All three company sizes have chosen the same primary adaptation strategies of changes to marketing and investment. However, each company size differs in their secondary issues. Large companies focus more on the target consumer and unique selling points, medium companies focus more on the management of liquidity, and small companies focus more on the COVID-19 preventative measure.

In conclusion, this research demonstrates how real estate companies select their adaptation strategy during crisis time varies according to the size of their asset. The key factor is to utilize the strategy that fits best with their operation. The result of this research will be useful to real estate company owners, government agency, as well as those who are interested, as a way to handle and operate a business during crisis time.