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Logo of Phnom Penh Post newspaper Phnom Penh Post - Construction spend nears $1bn

Construction spend nears $1bn

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A cyclist leaves the site of the US$100 million Elite Town housing development, on Diamond Island in Phnom Penh, yesterday.

The total value of approved construction projects in the Kingdom soared 97 per cent year-on-year through September, according to official figures, reaching nearly US$1 billion.

The number of projects fell to 1,689 for the first nine months of 2011, down from 1,718 in the same period last year, according to the Ministry of Land Management, Urban Planning and Construction.
But the total value of those projects reached $999.3 mill-ion, a significant jump from the $508.1 million in 2010.

Lao Tip Seiha, director of the ministry’s construction department, said yesterday the main reason for the increase was Cambodia’s political stability, as it made local and foreign investors confident to undertake development projects in the country.

A steadily increasing gross domestic product was also attractive to investors, he said.

“As we already expected [after the half-year mark], the value of investment in construction continued to increase in the first nine months of this year because of strong Cambodian economic growth.”

Lao Tip Seiha noted that in September alone, the ministry had approved a large number of construction projects including apartments, villas, garment, fertiliser and sugar factories, as well as guesthouses and hotels.

“We strongly believe the sector still continue to increase through the end of this year,” he said, claiming that foreign investors were returning to invest in Cambodia from regional countries such as Malaysia, South Korea, Japan, Malaysia, China and Vietnam.

Property experts have agreed that a recovery is taking place in the domestic construction and real-estate markets, although they said it was not at the level seen prior to the global financial crisis.

Knight Frank country head Sunny Soo said yesterday he had yet to see strong foreign interest in Kingdom real estate since the boom that peaked in 2008, but remained optimistic.

“For a time, I didn’t see foreign investors come to invest in the property sector, but I can see local Cambodian investors come out more and more to start construction and support the real-estate market,” Soo said.

Cambodia Property Limited managing director Cheng Kheng said the latest report was proof that the industry was showing steady improvement since the previous downturn.

“It's the right time to re-start construction and housing development projects,” Cheng Keng said.

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