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Logo of Phnom Penh Post newspaper Phnom Penh Post - Reaching for the sky has its limits at Olympia

OCIC’s sprawling Olympia City development appears to be running into some problems.
OCIC’s sprawling Olympia City development appears to be running into some problems. Moeun Nhean

Reaching for the sky has its limits at Olympia

As the real estate market barrage takes on a lulling pace, high-profile developments are slowing down in tandem. Olympia City recently confirmed that its initial plan of building the tallest residential building in the country has now been forced to take several floors back, due to a rising concern regarding profit return.

The sprawling, 11-hectare multi-use project is being developed by Overseas Cambodian Investment Corporation (OCIC), whose operations manager, Meng Chamroeun, said that the tallest building within the complex will now have 20 storeys cut from its originally planned 65 storeys. Another 45-storey building will also not be spared, and will now only total 38 floors.

Despite the reduction of the number of floors, the masterplan for the development – which includes an unspecified total number of buildings – is to be kept intact, Chamroeun elaborated.

“This storey-cutting plan is due to the unstable real estate market and the concern of profit return,” he said. “Nonetheless, we are not yet 100 percent sure of setting a certain number of storeys to these buildings.”

He explained that if the market picked back up, the company would revert to the original blueprint.

The groundbreaking for the two scaled down buildings is expected to be finished by 2020.

Olympia City’s 45-storey building now will be used as an office building, while the 38-storey one will house a 5-star hotel. Other buildings of shorter stature within the compound will play host to a shopping mall, restaurants, condos, and entertainment facilities.

Touch Samnang, OCIC’s vice-president, refused to comment, only giving the figure of approximately $500 million with regards to how much the company had invested on construction thus far.

Michael Nhim, head of investment group SIDO in Asia Pacific, commented that the real estate market in Cambodia has been showing great signs of a slow down because of the trickling fund flow from Chinese, Korean, Japanese and Taiwanese investors due to the tightening of laws from their respective governments.

While it is only logical to keep to original blueprints and master plans, instead of following the ebb and flow of market conditions such as that outlined by OCIC’s Chamrouen, it seems that some real estate experts are approving of the move.

Kim Heang, president of Cambodian Valuers and Estate Agents Association, said flexing to the market situation as seen by the company is the right concept.

“OCIC’s decision for now is logical; if the building will not be successful, why bother doing it anyway?” Heang asked. According to Heang, home-buyers now are better informed on what type of property appeals to them, and what their purpose of purchasing a home is – be it for investment or owner-occupier intentions.

“Cutting down the storeys is a good strategy because it helps the company and also the property market so as to avoid even more oversupply problems in this kind of situation.”

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