Having carved its niche in offering residential and commercial elements within its industrial park, Le Urban Eco Park (LUEP) entered into a joint venture with two Singaporean companies last month to further develop its commercial aspect.
LUEP, developed by C.I.A.C Investment Limited, partnered with Singapore Stock Exchange-listed (SGX) property investment company Ocean Sky International Limited, and private real estate firm Centra Properties Pte. Ltd., to jointly establish a proposed 71-unit shophouse project within the industrial park. The total value of the JV is approximately $2.3 million.
The SGX-listed company recorded total cash and cash equivalents of $12.91 million as of the end of March.
In addition to these shophouses, the industrial park is also driving more focus on having an entire support industry entailing pharmacies, minimarts, cafes, and mechanics to cater to the currently 4,000-odd factory workers in their compound.
“These workers are in just one factory that’s operating; two other factories are now installing finishing touches and will be operational next month. There will be 11 factories in total, built progressively when we get more [factory] tenant requests.
“So, these people need services in a support industry, and the shophouses will predominantly provide this support, as well as for people to set up businesses there,” explained Kelvin Chua, chief operating officer at LUEP.
Ocean Sky International and Centra Properties are treating the JV as a test bed to monitor real estate opportunities in Cambodia, while also noting that LUEP was getting more crowded, thus seeing the need for support services.
Phase 1 of the shophouse venture will see 28 units built in the next nine months, while the second phase will have 43 units.
On how he thinks his shophouse element deviates from a one-dimensional dormitory setting, Chua said, “There’s a lot of flexibility towards how you want to customise your shophouse. You can have a business downstairs and stay upstairs, or you can also rent the above space out to factory workers or even to the expats (factory managers and supervisors).”
While LUEP does have dormitories – with one completed row of 40 units accommodating up to 150 workers at present, and more being built – in its vicinity, Chua said he had observed many other small businesses and landowners around the National Road 3 area building dorms on their land to lease to the factory workers.
“They see that our worker numbers have spiked now, so they’re taking the opportunity to also build dorms to facilitate these workers,” he added.
According to Hoem Seiha, director of research at property valuation firm VTrust Appraisal Co. Ltd., one of the top priorities of factory tenants when searching for land plots to build their factory is to seek existing nearby communities with enough amenities and services.
He said: “For Le Urban Eco Park, yes it will attract tenants, but the attraction isn’t as strong as [industrial parks] nearer the central urban because the compound is located about 20 kilometres outside the city, where existing basic amenities are not yet available.”
Chua, however, believes he has this part covered. “We’re not in the city,” he admitted, “but workers here now will have these services ready and available to them in the next nine months.”
Furthermore, he cited the fact that food kiosks currently within the park’s premises have been a hit with the factory workers. “Between two factories, we’ve left an open space park-like setting and within that are 30 little kiosks selling food and drinks. This is enough to support 4,000 workers for now,” he said.
Chua said that at the end of the day, he wants to create a centralising system for factory tenants within LUEP.
“Our idea is that these factory owners don’t need to worry about their core business which is their factory production, and to leave everything else like accommodation, food, and other support services to us. We are the one-stop-shop.”
With at least 50 other factories along the National Road 3 and National Road 4 areas, like those within Vattanac Industrial Park and Phnom Penh Special Economic Zone, the catchment of people will definitely always require services encompassing not only food and beverage, but also medical, fashion, and vehicular purposes.
At full capacity, according to Chua, he expects LUEP to reach a minimum of 30,000 workers once all 11 factories are built, although no timeline has been specified for when this completion benchmark is.
Seiha agreed that having a support industry within an industrial park itself will add value to the lives of factory workers, owners, and nearby residents alike.
“It’s just like a community where people might need more than basic services to ease their lives in the compound. They do not need to travel far to get the daily needed services,” said Seiha.