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Demand for office space on the rise

Content image - Phnom Penh Post
Vattanac Tower, pictured above, has attracted more tenants this year, thereby reducing occupancy vacancy rates. PHOTO SUPPLIED

Demand for office space on the rise

The demand for office space is anticipated to surge this year after a lacklustre 2015; however, this is in line with rising supply.

Lim Pusithavrith, a leasing management officer at Vattanac Tower, said recently that the demand for office space would rise significantly this year because of the flow of new foreign and local companies.

The demand for office space in Vattanac Tower has increased from 25 to 30 per cent in the previous 12 months, with the occupancy rate moving to around 50 per cent.

He continued that the developer aims to increase the occupancy rate for office space to up to 80 per cent by the end of 2016.

Vattanac office space is priced at $28 to $38 per square metre, plus $5 for management service fee.

“The company is not afraid of competition because we have partner companies renting the space and they play a role in recommending other new companies to rent our Grade A office space in Phnom Penh,” Pusithavrith added.

Nonetheless, Hun Menghieng, a manager at VTrust Property, who is currently managing three office buildings in Phnom Penh, said the office space rental rate is not better than last year.

“We have only seen a 10 to 15 per cent increase at VTrust Tower,” he said.

He said the office space market is becoming highly competitive because of the increase in office space supply and the slow trickle of new customers.

Thida Ann, associate director of CBRE Cambodia, said the demand for office space had risen this year due to the increasing number of banks, insurance companies and foreign companies in the market.

However, while demand has increased, so too has supply.

According to Ann, 2016 will see an additional four to five Grade B and Grade C office buildings entering the market.

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