Warehouses and factories rental is on the rise

Warehouses and factories rental is on the rise

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Warehouses in Phnom Penh. Photograph: Pha Lina/Phnom Penh Post

Renting warehouses and factories in Cambodia during the first five months of 2012 increased by 27.3 per cent compared to the same period in 2011, according to a report from VMC Real Estate company obtained by Post Property.

Dith Channa, Manager of VMC Real Estate, said warehouses and factories in Phnom Penh are more in demand than those in the suburbs, but warehouses and factories in Kandal and Kampong Speu provinces are also seeing a lot of demand.

The manager added that the demand for warehouses and factories to rent in Kandal and Kampong Speu provinces increased 30 per cent compared with last year, but in Phnom Penh it increased by up to 40 per cent. This rising demand also shows investors’ trust and confidence in Cambodia’s economy, he said.

He said that after Cambodian economic conditions improved in early 2011, a lot of investors resumed their investment activities in sectors such as tourism, agriculture, garment manufacturing and construction. This is the main reason for the spike in demand.

He stressed “a lot of domestic and foreign products need warehousing for storage, and investors of export-oriented factories are strongly in need as well.” He added that the warehouse and factory rental price in Phnom Penh currently is $2 per square metre per month, compared to only $1.70 last year, while in some provinces the rental price is $1.50 per square metre, compared to $1.20 last year.

Chrek Soknim, Vice Director of VTRUST Property Company, said the demand for warehouses and factories is definitely on the rise, but mainly in the city.

He said “demand for renting warehouses and factories increased from 10 to 20 per cent compared with last year, while the rental price in good places in Phnom Penh increased to $6 or $8 per square metre, almost equal to the price of leasing office space.”

He added that most housing and office space investors have to complete their construction before looking for customers, but investors in warehouse and factory leasing need to look for customers first, before starting construction. This accounts for the speed at which warehouses and factories are leased.

He added that the demand for warehouses and factories that his company received is mostly on the city outskirts and the border areas with Vietnam, including Kampong Cham, Kratie, Prey Veng, Svay Rieng and Kandal, because a lot of goods are transported past the area and need warehousing for storage and distribution.

Although the demand for renting warehouses and factories is on the rise, there is still limited investment in the warehouse and factory leasing sector.

VMC Real estate’s Dith said the demand for warehouse and factory space “is everywhere”, so investors who have money and vacant land should invest.

To contact the reporter on this story: Seun Son at [email protected]

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