Construction on Two Condominiums to Begin in Q1

Cambodia’s growing condominium sector shows no signs of slowing down, with construction on two new condominiums set to begin in the first quarter of this year.

According to real estate firm CB Richard Ellis’ December market view report, released Wednesday, work will begin on Sky Villa Tower, a 254-unit two-tower development near Olympic Stadium, and Sovann Condominium, a 104-unit luxury block in Boeng Keng Kang I district, between now and the end of March.

The two developments will join the 35 completed or under-construction condominiums in Phnom Penh, the report says.

“CBRE has continued to witness strong interest from the wider Asia Pacific region, with increasing investment from Singaporean, Japanese, Hong Kong and Chinese residents,” it says.

By 2017, when the two projects are expected to be finished, there will be approximately 9,500 condominium units in the city, Thida Ann, a senior associate director at CB Richard Ellis, said in an email.

Ms. Ann said that compared to other countries in the region, Cambodia’s inexpensive units and potentially high returns were alluring for investors. According to the report, the price of a high-end condominium unit ranges from $1,500 to $3,000 per square meter.

Sung Bonna, chairman of local firm Bonna Realty, estimated that there are about 5,000 completed units in the capital and that 80 to 90 percent of them are occupied.

Mr. Bonna said that he believed the market was healthy, with demand currently matching supply, but was concerned that as supply increased, investors—many of whom are purchasing the units with the intention of renting them out during a speculative wave of demand expected with Asean economic integration—may be unable to fill the properties.

“After the condominiums have been constructed, the occupancy rate is the concern,” he said.

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