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Retail space in Phnom Penh up 11% as market remains nascent

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Borey Peng Huoth Group’s $60 million PH Diamond Place is scheduled to be completed this year, and is located along Hun Sen Boulevard in Meanchey district’s Chak Angre Krom commune in Phnom Penh. HENG CHIVOAN

Retail space in Phnom Penh up 11% as market remains nascent

Retail space in Phnom Penh last year increased 11.11 per cent over 2018, a research report from real estate service provider CBRE Cambodia said.

The report, which was obtained by The Post on Wednesday, said there were a total of 19 buildings providing 314,000sqm of retail space as of the end of last year.

At the end of 2018, there were 18 buildings in the capital providing 282,580sqm of retail space, it said.

Rental prices were little changed. The report lists the current average prices at $32.25 per square metre at prime shopping mall units, $29.83 at prime retail podium units, $23.05 at community mall units and $26.50 at prime high-street units.

However, the overall occupancy rate dropped from 91 per cent in 2018 to 89 per cent last year.

CBRE Cambodia director Ann Sothida said retail space is a new market in the Kingdom. “The current shift in the image Cambodians have of the retail market has attracted more retail brands, especially mid-end brands here.

“The additional supply will make the market more competitive and will affect occupancy rates as it will take some time to absorb the market share,” she said.

The CBRE Cambodia report said there will be 20 more retail locations completed by the end of this year.

These are 11 community malls, five prime retail podiums and four shopping malls providing more than 261,746sqm of retail space.

“Based on past experiences, we [CBRE Cambodia] think some projects will be delayed, so maybe not all 20 buildings will be completed this year,” said Sothida.

Keller Williams Sen Sok regional operation principal Sam Soknoeun said demand for retail space will remain high in Phnom Penh, especially in the nine satellite districts, which are undergoing massive housing development.

The nine satellite districts are Dangkor, Meanchey, Russey Keo, Por Sen Chey, Chbar Ampov, Sen Sok, Chroy Changvar, Prek Pnov and Kambol – established after Prime Minister Hun Sen signed a sub-decree on January 8, last year, which separated it from Por Sen Chey district.

Soknoeun cited economic growth and increased incomes as the main drivers for the Kingdom’s rising demand for products and services.

“The demand for retail space will continue to grow as long as the development of the city continues,” he said, adding that he expects retail complexes to sprout up shortly along national roads 5 and 6.

A recent report from the Ministry of Land Management, Urban Planning and Construction said investment in the construction sector soared 78.88 per cent last year over 2018.

Last year, investment reached $9.353 billion across 4,446 projects, which occupy 18.54 million square metres. In 2018, it reached $5.228 billion across 2,867 projects, which occupied 11.42 million square metres.


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