Phnom Penh’s Chamkarmon and Tuol Kork districts will continue to see investment in apartments, while Sen Sok will become a new target market, as the number of apartments in Phnom Penh is set to almost triple by 2030.
According to a report issued on Tuesday by property firm VTrust Appraisal, Chamkarmon district ranks first in terms of apartment numbers, with 5,820 units spread across 230 projects, equivalent to 64 per cent of the total supply.
It is followed by Tuol Kork district with 1,446 units across 56 projects, 16 per cent of the market. Prampi Makara and Daun Penh districts have 635 units and 590 units respectively, according to the report.
VTrust Appraisal’s research director Hoem Seiha said Sen Sok district is transforming into an important new commercial area, making it attractive as the next investment target.
“Sen Sok is drawing the attention of institutions. Obviously, big projects are coming up there,” he said.
Phnom Penh currently has 355 apartment projects encompassing 9,021 units, which will almost triple to 28,000 units by 2030, according to the report.
Seiha said that the supply of apartments across Phnom Penh will grow at a 10 per cent compound annual growth rate, meaning an average 1,580 new units will be added to the market per year between now and 2030.
“The apartment market in Cambodia will improve, especially average level apartments that will attract more domestic customers, as the population and urban traffic become denser,” he said.
Seiha said his conclusions are based on a number of factors such as demographic growth, the number of foreigners coming to live and work in Phnom Penh, economic growth, political stability, increasing Chinese investment and tourism, and changes in Cambodian attitudes.
“Currently, some condominium investors have upgraded their projects to be apartments because the sale of condos may be difficult,” he said.
CEO of Cambodia Angkor Real Estate Ping Serey said that over the next five years, the apartment market will continue to grow as more Cambodians choose to live in apartments.
Currently in Phnom Penh, one-bedroom apartments have an average rent of $400-$600 per month. Two-bedroom apartments average $800-$1,200 per month and three-bedroom apartments $1,500-$3,000.
In the fourth quarter of 2018, the total occupancy rate of Phnom Penh’s apartments was 84 per cent.