Construction crews are preparing to break ground on the tallest tower of the Olympia City project, but could end up paring down the herculean 65-storey skyscraper that was once tipped to be the tallest residential building in the country.
Meng Chamroeun, chief engineer for Overseas Cambodian Investment Corporation (OCIC), which is developing the mixed-use project on 11 hectares north of the Olympic Stadium in Phnom Penh, said 20 floors could be trimmed from the planned 65-storey tower due to weaker market projections.
He said OCIC management was reviewing the project’s master plan and would consider how the market has changed since construction began five years ago.
“Olympia City’s marketing staff recommended that the company should not invest funds into a building with 65 floors,” he said. “Now the company’s top management is deciding whether to reduce its size to 45 floors or stick with the original 65-storey plan.”
The master plan of the Olympia City complex envisions a total of 13 buildings including hotels, condominiums, offices and a multi-level shopping mall. OCIC has sunk over $500 million into construction to date and expects to complete the massive project by 2019.
Meng said about 70 percent of the overall construction is finished, and tenants have already begun moving into four 20-storey buildings completed during the project’s first phase. Olympia Plaza, a seven-storey shopping mall with 100,000 square metres of retail space, is due to open its doors in the third quarter of 2018.
Groundwork has been completed on over half of the buildings in the Olympia City complex. The next phase will see construction of the high-rise towers including Olympia Tower, which combines condominiums, a hotel and office units.
OCIC is also considering revising the blueprints for an adjacent office tower and trimming up to seven floors off its original 45-storey design.
The towers are due to come online amid a growing oversupply of residential and office space in the capital.
According to Ann Sothida, director of CBRE Cambodia, the occupancy rate of apartments and condominium units is currently about 80 percent, but can be expected to fall as several large-scale projects come online in short succession.
“Occupancy rates will drop as the market must absorb an additional 13,000 units in 2018,” she said, adding that office space is also expected to grow significantly this year and dilute demand.
So far, there have been no signs of a slowdown in demand at Olympia City, according to Tak Sophy, the project’s real estate operations manager. She said all units have been sold in the four 20-storey buildings and about 20 percent of the condo and shophouse owners have already moved in.
“I think once the shopping mall is finished, there will be more owners moving in,” she said. “I’m not quite sure of how many residential units and houses there are in the Olympia City project, but these four buildings alone have a total occupancy of 1,588 units.”
Kim Heang, president of the Cambodian Valuers and Estate Agents Association (CVEA), said Olympia City is an enormous project, though it cannot compare in scale to projects seen in Malaysia and Singapore. He said the initial unit prices were exceptionally lowgiven the complex’s central location, but prices have now doubled.
“The success of a project is not determined by how much of theconstruction is completed, but rather by achieving more than 50 percent occupancy,” he said.
When asked whether he feltthe current market conditions would support a 65-storey skyscraper, Heang said the height of the building – whether 45 or 65 floors – was less important than selecting a good location to tap into future growth.
“If the company has enough funds to complete the project without relying on the sale revenuethen I think it should aim for 65 floors,” he said.
He added that while the local market currently might not support the skyscraper, “in the next five years a 65-storey building won’t face any market issues.”