Rents and demand for serviced apartments in Phnom Penh are back on the up, buoyed by the reopening of the country in early November and general improvement in the Covid-19 situation, according to a prominent real estate company.
CBRE Cambodia, the local affiliate of US commercial real estate services and investment firm CBRE Group Inc, said in its latest report that the average monthly rent for top-quality “Grade A” apartments was $10-30 per square metre during the second quarter of this year, up by 2.4 per cent year-on-year on the whole.
In the “Grade B” category, apartments went for $7-22 per month per square metre at the time, up by 1.5 per cent year-on-year overall. CBRE Cambodia attributed the wide range in prices to the variation in room types, in the report published on July 7.
The study said the capital’s rental apartment supply of both grades stood at about 4,000 units as of June 30, after three developments were completed and put on the market in the first half of this year. These were Grade A projects Citadines Flatiron Phnom Penh in Tuol Kork district and Jasmine Residence in Boeung Keng Kang district as well as Grade B mixed-use development TK Central in Tuol Kork.
Responding to a query from The Post during the report’s launch ceremony, Kim Kinkesa, senior manager of research and consulting at CBRE Cambodia, indicated that these recent market uptrends have been propelled by the increased number of foreigners entering the Kingdom due to its reopening and easing of Covid-19 restrictions as cases plummeted.
“The apartment market is highly dependent on foreigners renting accommodation, so when the number of foreigners travelling to Cambodia increases, the market will recover accordingly, no ifs ands or buts about it,” she said.
Kinkesa pointed out that a dearth of new developments in Cambodia had resulted in considerably greater demand-to-supply ratios for serviced apartments and the accompanying uptick in rents. However, she suggested that both were tempered by, among other things, a lacklustre recovery in cross-border travel as well as global economic shocks, such as those tied to the Russia-Ukraine conflict.
For the rest of this year, Kinkesa predicts that “demand and rental prices for apartments in Phnom Penh will continue to rise, although they will most likely not exhibit sudden jumps”.
According to the Ministry of Tourism, the number of foreign visitors to the Kingdom has been on a progressive upward trajectory since November’s reopening, registering 343,464 in the first five months of 2022, a 274.98 per cent year-on-year increase from 91,596.