The Kingdom’s investment in the construction sector rose to $1.65 billion dollars in the first quarter of 2016, compared with last year’s $448 million, representing an astounding 267 per cent increase.
Lao Tip Seyha, deputy director general of the Ministry of Land Management, Urban Planning and Construction confirmed the statistics on Monday, saying that there are 473 construction projects taking up a total of about 3.7 million square metres.
As of April last year, Cambodia had 770 multi-storey buildings, and 122 suburban cities – some of which are still under construction.
“The increase in investment owes to the fact that Cambodia has convenient investment laws that subsequently allows for an investment increase in the political status, economic development, and a higher income for the people,” Seyha said. He added that the growth of the construction sector arose from substantial purchases from both local and foreign investors.
“The low-cost of labour in Cambodia, and sufficient construction materials’ has set the affordable price for buildings, which expand the investment growth in the sector.”
Ann Thida, senior associate director of CBRE Cambodia, said that this investment growth is a good sign for the economy and the total national revenue of the country. However, Thida said if purchase rates continued to fall, investments would be affected to the point of closure.
“What concerns me is the expensive prices that developers put up. I think there should be a study between the market needs and the price that the developers set in order to regulate a matching price that people can afford,” she added.
Kim Heang, president of Cambodian Valuers and Estate Agents Association, expressed optimism around the new statistics, saying it indicates sound growth as massive investment has been allotted into the construction sector from 2015 to 2016.
“Nowadays, customers are more demanding, so sellers have to please the customers as much as possible,” Heang said.
At the end of the day, according to Heang, “the status of this sector is the same. If the sellers set low-priced products, there will be more customers, but if the price does not drop, then the number of customers will also stagnate.”