Foreign firms turn to tower

Foreign firms turn to tower

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A man walks across the ground floor of Phnom Penh Tower yesterday. More than 40 percent of its office space has been spoken for. Photo by: Meng Kimlong

OFFICE space in Phnom Penh Tower is continuing to attract large multinational firms, with Air France International the latest company to begin operations there, officials at the tower said yesterday.

More than 40 percent of the available office space is now rented in the Kingdom’s second tallest building, according to Hong Youvoin, Marketing Manager for the tower’s construction firm Hyundai Amco Company.

“Since its completion in April, we have rented over 40 percent of the space to clients including banking firms, auditing consultants, airlines, embassies and real estate companies.”

The Embassy of Sweden also moved into the tower recently, joining The Coffee Bean & Tea Leaf, Mekong Bank and Richard Ellis (CBRE), he added.

Situated on the capital’s Monivong Boulevard, Phnom Penh Tower is just one of the recent additions to the city’s evolving skyline, including the Kingdom’s tallest building, Canadia Tower, which opened in November 2009.

In the months of May and June this year, demand for office space increased slightly, partly due to the emergence of new investors from Japan, South Korea, Vietnam, and in particular, NGOs in search of quality office space, Hong Youvoin said.

The average rent for office space within the tower is US$19 per square metre, said Hong Youvoin who hopes at least 60 to 70 percent of the building will be occupied by the close of the year.

Property transactions in Phnom Penh doubled in the first six months of the year, compared with same period in 2010, however, figures are yet to reach pre-crisis levels, according to National Valuers Association of Cambodia and Bonna Realty Group President Sung Bonna.

“We sold 20 properties in the first six months of 2011, compared to the 10 sold in the same period last year,” he said.

“For the first two to three months of the year, we saw many investors from Singapore, Malaysia, Vietnam and China coming to the Kingdom to look for property.”

Phnom Penh Tower’s prime location has been a key factor in the number of foreign investors renting office space, added Sung Bonna.

The occupancy rate for grade B buildings throughout the capital now lies at approximately 85 percent, averaging between $8 to $18 per square metre, while grade A rent can command up to $25 per metre, according to National Valuers Association of Cambodia figures.

The arrival of the Cambodian Securities Exchange is expected to boost the transactions of office space, said Sung Bonna.

“Many [foreign] investors will come to the country and invest here.”

Office supply in Phnom Penh could hit 20,000 square metres by 2013, almost double the current space, if potential projects are completed, CB Richard Ellis Cambodia predicted earlier this year.

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