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Property investments take dive

Content image - Phnom Penh Post
Workers at a construction project funded by Chinese investment in Preah Sihanouk province. Heng Chivoan

Property investments take dive

Cambodia’s construction investment value dropped more than 14 per cent in the first nine months of the year compared with the same period last year, a report released on Wednesday by the Ministry of Land Management said.

It said in the period from January to end-September, the government approved a total of 2,541 construction projects valued at just over $4.8 billion – a fall of 14.47 per cent from more than $5.6 billion in the same period last year.

Ministry of Land Management undersecretary of state Lao Tip Seiha said the construction sector is one of the main machines boosting economic growth in the Kingdom. He believes the sector will continue to grow.

“The construction sector is playing a significant role in sustaining national economic growth by contributing to job creation, raising living standards and providing new experiences and knowledge to the people,” he said.

Over the nine months, 92 new buildings from five stories and above were built in Phnom Penh and as of 2005 until now, there are 1,084 such buildings.

Data from Preah Sihanouk provincial department of Land Management shows that from 2005 to 2016, the province saw an increase of 46 five- to 35-storey buildings.

Seiha said despite the rapid growth of Preah Sihanouk’s construction sector, Phnom Penh remains one of the highest potential locations for the national sector.

The report showed that 1,028 construction companies registered at the ministry during this period.

Century 21 Mekong Co Ltd CEO Chrek Soknim said that a slight decrease in value in the construction sector is a common issue because all major projects take at least two to three years to complete.

“So if the projects were registered last year, this will cause its value to fall this year,” he said, adding that the important thing is whether the projects are developed according to plan.

“The decline in construction investment value in the last nine months does not indicate that the growth of the construction industry in Cambodia is slowing down. This is because it may stem from the time the company started to build.

“I think the construction and real estate sectors in Cambodia will continue to grow for a long time, with no obstacles,” he said.

Last year, the ministry approved a total of 3,052 construction projects with more than $6.428 billion in value compared with $5.256 billion in 2016, the report said.

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