Logo of Phnom Penh Post newspaper Phnom Penh Post - Bulls prevail despite condo glut



Bulls prevail despite condo glut

Condo supply in Phnom Penh is expected to hit 38,920 units by the end of 2019.
Condo supply in Phnom Penh is expected to hit 38,920 units by the end of 2019. Heng Chivoan

Bulls prevail despite condo glut

Despite condo supply in Phnom Penh increasing at a fast rate as projects complete construction, many in the real estate industry are maintaining an upbeat outlook on future market conditions. However experts have cautioned that moving forward, new projects will need to be more prudent and mindful in their plans to build condos, especially when it comes to location.

Tuy Bun, shareholder of Residence L Cambodia which is developing condominiums in Phnom Penh for the middle class said while the broader condo market looked to be struggling from a sales perspective, his project had been steadily selling off units with 70 percent of units having been sold.

“My project is still moving forward little by little. I focus on people within the middle income bracket, and I sell them at a reasonable price range of between $1,000 and $1,100 per square metre,” he said.

When asked what he thought the future held for the condo market in Phnom Penh, he said his feelings were mixed, noting that he was informed that a project within the same price range as Residence L Cambodia had been recently halted in the middle of its construction process.

Real estate firm CBRE Cambodia estimates that condominium supply in Phnom Penh alone currently stands at 4,253 units and will reach 38,920 units by the end of 2019, representing a 9 fold increase.

Thida Ann, deputy director of CBRE Cambodia, commented that the luxury condo market had tapered off slightly, however developers targeting people within the middle income bracket were performing better.

Despite Ann’s comments, investors in high-class condos in Phnom Penh are shaking off any concerns about supply and sales woes.

A case in point is Sear Rithy, chairman of WorldBridge Group, who has invested millions in partnership with a Singaporean firm to develop two luxury residential projects. He told Post Property he does not see any threats to the condo market.

However, he said that developers needed to be wise when choosing the location of their project as the right location could make a big difference in sales numbers.

“Condos that are facing an uncertain future are those constructed in unsuitable locations, as well as projects lacking investment capital,” he said,

He continued, “My condo is strongly focused on its location, quality, and a strong investment capital foundation; and I’m not just selling a house, I’m selling a lifestyle.”

Meanwhile, Touch Samnang, deputy director ofthe Overseas Cambodia Investment Corporation (OCIC), noted that those still interested in buying condos in Phnom Penh comprised of mainly foreigners from China, Japan and Taiwan. Samnang also believed that any residential projects, not just condos, were a hard sell if the location was unfavourable.

Noun Rithy, Khmer Foundation Appraisal’s CEO, maintains a bullish outlook when it comes to Cambodia’s condo market, believing the market was “teeming with potential”.

He continued, “I don’t think that there’s anything to worry about, seeing as the country has achieved political stability and prosperous economic development.”

“Cambodia still has potential and as the number of investors to Cambodia continues to increase, they will want to live in condos when they arrive.”

Based on Rithy’s calculations, condo units that are currently on the market at the price of $300 to $400 per month usually attract Cambodian customers while units ranging from $550 to $1500 a month are mostly occupied by foreigners.

MOST VIEWED

  • Ice cream, noodles flagged over carcinogen

    The General Department of Customs and Excise of Cambodia (GDCE) has identified three types of instant noodles and ice cream trademarks originating from Thailand, Vietnam and France that are suspected to contain ethylene oxide, which poses a cancer risk to consumers. The general department has

  • Exclusive interview with Josep Borrell Fontelles, High Representative of the EU

    CAMBODIA is hosting the 55th ASEAN Foreign Ministers’ Meeting (AMM) and Related Meetings this week with top officials from the US, China, and Russia and other countries in the region slated to attend and to meet with face-to-face with their counterparts on the sidelines. In

  • Rise in Thai air routes to Siem Reap fuels travel hopes

    Local tourism industry players are eager for regional airline Bangkok Airways Pcl’s resumption of direct flight services between the Thai capital and Siem Reap town on August 1 – home of Cambodia’s awe-inspiring Angkor Archaeological Park – which is expected to boost the growth rate of

  • ASEAN Foreign Ministers’ meet commences, Taiwan issue possibly on table

    The 55th ASEAN Foreign Ministers’ Meeting (AMM) and related meetings hosted by Cambodia kicks off in Phnom Penh on August 3, with progress, challenges, and the way forward for the ASEAN Community-building on the table. Issues on Taiwan, sparked by the visit of US House Speaker

  • NBC eyes KHQR payments in Laos, Vietnam

    The National Bank of Cambodia (NBC) is working with Lao and Vietnamese authorities to expand the use of KHQR code cross-border payment systems to promote trade and investment as well as increase the scope of regional economic linkages, and in particular, facilitate remittances from overseas

  • Recap of this year’s ASEAN FM meet and look ahead

    This year’s edition of the ASEAN Foreign Ministers’ Meeting (AMM) hosted by Cambodia comes against the backdrop of heightened global tensions and increasing rivalry between major powers that have been compared to the animosity of the Cold War era. The following is The Post’