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Land price along boulevards on the rise

121025_03

Traffic along Mao Tse Tung Boulevard in Phnom Penh. Photograph: Pha Lina/Phnom Penh Post

The sale and purchase of land along the four major boulevards in Phnom Penh climbed up to 40 per cent in the third quarter of 2012, while the construction of offices is gradually on the rise, according to real estate experts.

The growth of land prices is encouraging investors to increase their investments along Monivong, Norodom, Mao Tse Tung and Russian Federation Boulevards, which grew 15 per cent in the third quarter in 2012, compared to the same period in 2011.

VMC Real Estate chairman Dith Channa said high-priced lands are located along the main boulevards and other nearby areas, and even though the rainy season has made the construction of buildings more difficult, the sector is still growing.

“The price of real estate, we’ve observed, along the four main boulevards is different, but the demand rate of growth is similar,” he said.

Based on the assessment of VMC Real Estate, the land prices ranged between $2,500 and $3,500 per square metre along Monivong and Norodom Boulevards in the third quarter of 2012, compared to $2,000 to $3,000 in 2011. Along Mao Tse Tung Boulevard they ranged between $2,000 and $2,500, compared to the $1,800 to $2,000 last year. And along Russian Federation Boulevard they ranged between $1,000 to $1,500 dollars, compared to the $900 to $1,000 in 2011.

The size of trade and office building investments along Monivong and Norodom Boulevards is growing sharply because of the variety of businesses and the density of people in those areas, he said.

Foreign investors are still interested in Cambodian building investments such as housing, trade and offices buildings because they consider the building sector an easy way to make profit, even after investing a lot of capital, Channa added.

Channa claimed that real estate investments will go smoothly if there is political and economic stability.

Among foreign investors in Cambodia there are Japanese, Chinese, South Korean, Thai, American, French, Singaporean, Malaysian, Russian, Taiwanese, and British nationals.

“Most of real estate investments get more profits then they lose, because it is a good sector among key sectors,” Channa said.

Local investors are optimistic about the potential of real estate and continue to invest. “Starting to invest now is good. It is logical to invest in Cambodian economic growth,” he added.

Key Real Estate General Manager Sorn Seap said the selling and purchasing of real estate along Mao Tse Tung Boulevard is growing, and that the land price is lower than on Monivong and Norodom Boulevards.

Real estate and building investment will rise further because Cambodian economic growth is gradually increasing, he said.

Noun Rithy, general manager of Bonna Realty Group, said average real estate prices are climbing, but along the main boulevards it is increasing about 15 per cent this year because of the scarcity of land there.

“We have customers now but we are having difficulty finding real estate to supply them with because there are few sellers in those areas,” he said.

To contact the reporter on this story: Seun Son at son.seun@phnompenhpost.com

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