Search

Search form

Rents to melt as serviced condo competion heats up?

Rents to melt as serviced condo competion heats up?

Cambodian real estate insiders say rents for serviced apartments are in decline due to increased competition from the condo market, with supply for serviced apartments set to decline in the long run.

Kim Heang, president of Khmer Real Estate, said supply and demand for the luxury apartments long popular with high-rolling expats was stable in early 2015.

However, he said the number of serviced apartments did not increase at the end of 2014 and the market might be in full decline by 2017, the year before the number of condo units reaches 10,000.

Hamptons Apartments
The luxury Hamptons Apartments in BKK1. Sreng Meng Srun

“The number of [serviced] apartments did not increase at the end of 2014 and prices lessened due to the competitive market,” he said.

“The increasing number of condos has led to significant competition and price downturns.”

Chrek Soknim, CEO of Century21 VTrust, said the serviced apartment market was still robust, especially for smaller units, but would be in a problematic situation next year due to the increasing number of condos.

“The serviced apartment market has remained strong since their units are usually larger than condos,” he said.

“However, serviced apartment prices will not escalate anymore and the supply will begin shrinking due to the increasing number of condos in the market.”

Research from Century21 VTrust said prices for top-quality, “Grade A” serviced apartments with one bedroom start at $1,300 a month, while prices for Grade B range from $750 to $1,300 and for Grade C are priced between $400 and $500.

Independent property analyst Keuk Narin said the decline in serviced apartment prices was leading to increasing competition to install better amenities.

“The number of serviced apartment tenants has seen little increase. In contrast, the number of serviced apartments is swelling. Consequently, prices cannot be rising,” he said.

Narin said Grade A, one-bedroom apartments in Boeung Keng Kang 1 were priced from $1,300 to $1,500 per month, while Grade B apartments start from $700 to $1,000 and Grade C ranges from $350 to $400.

In the cheaper area of Russian market, Grade A apartments are priced from $800 to $1,000 per month and Grade B goes for $500 and $800, he said.

RECOMMENDED STORIES

  • Breaking: PM says prominent human rights NGO ‘must close’

    Prime Minister Hun Sen has instructed the Interior Ministry to investigate the Cambodian Center for Human Rights (CCHR) and potentially close it “because they follow foreigners”, appearing to link the rights group to the opposition Cambodia National Rescue Party's purported “revolution”. The CNRP - the

  • Rainsy and Sokha ‘would already be dead’: PM

    Prime Minister Hun Sen on Sunday appeared to suggest he would have assassinated opposition leaders Sam Rainsy and Kem Sokha had he known they were promising to “organise a new government” in the aftermath of the disputed 2013 national elections. In a clip from his speech

  • Massive ceremony at Angkor Wat will show ‘Cambodia not in anarchy’: PM

    Government officials, thousands of monks and Prime Minister Hun Sen himself will hold a massive prayer ceremony at Angkor Wat in early December to highlight the Kingdom’s continuing “peace, independence and political stability”, a spectacle observers said was designed to disguise the deterioration of

  • PM tells workers CNRP is to blame for any sanctions

    In a speech to workers yesterday, Prime Minister Hun Sen pinned the blame for any damage inflicted on Cambodia’s garment industry by potential economic sanctions squarely on the opposition party. “You must remember clearly that if the purchase orders are reduced, it is all