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Phnom Penh warehouse demand increases

Demand for warehouse space is up 10 to15 per cent year-on-year.
Demand for warehouse space is up 10 to15 per cent year-on-year. Hong Menea

Phnom Penh warehouse demand increases

Demand for warehouse space rose over the first five months of 2014, according to local property experts.

The managing director of Town Real Estate Company, Van Chanthorn, said demand for warehouse space increased in some areas compared with the same period last year, adding that his company had received many requests for warehouse storage.

The areas that are most in demand, Chanthorn said, are Chamkar Doung, Chorm Chao, Veng Sreng and along national roads 3 and 4.

“The average size of requested warehouse space ranges from 3,000 to 6,000 square metres,” he said, adding that the average price per square metre was $1.80 per month, with leases averaging three years.

Chanthorn said he expects demand to continue to trend upwards once ASEAN economic integration got under way late next year.

“Warehouse demand will likely double due to the number of investors coming to Cambodia,” he said.

Sear Chailin, CEO of CL Realty, agreed that warehouse demand increased in the first five months of the year. Demand was strongest in areas such as Veng Sreng and Chorm Chao, with customers seeking storage space of 300 to 800 square metres, while space on the outskirts of town tended to average 1,000 to 3,000 square metres, he said.

According to Chailin, the contract periods for warehouse leases ranged from three to 10 years. He added that the market price for warehouse space started at an average of between $1.80 and $2.20 per square metre, depending on location, size, adjacent roads and water and electric supply.

“Lease contracts are for at least three years and for a maximum of 10 years, and the contracts were very important, allowing transparency for tenants and owners, particularly for tenants in terms of utilisation of the warehouse space,”
he said.

On the question of tenants, Chailin said they were a mixture of local and international businesspeople.

Cambodia Trust Real Estate director Oum Vutha said demand for warehouse space had increased 10 to 15 per cent in the first five months of this year compared with the same period of 2013. Vutha attributed the surge to new companies participating in the Cambodian market.

Warehouse prices in Phnom Penh proper average $1.60 to $1.80 per square metre a month, while prices on the outskirts of town average around $1.20 per square metre, he said, adding that demand was highest for warehouse space averaging between 3,000 and 4,000 square metres, with clients occasionally demanding larger spaces of 7,000 to 8,000 square metres.

“The areas in which we are seeing the greatest demand are in Stueng Meanchey, Chorm Chao and Veng Sreng – despite higher prices – due to ease of transport and because warehouse standards tended to be higher in those areas, with better water and electricity supply and offices included,” he said.

“If the political situation in Cambodia does not worsen, warehouse demand will likely increase with ASEAN integration,” he said.

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