Land and landed residential prove to be the two most resilient real estate sectors in Cambodia, largely due to their popularity amongst a domestic audience. Beyond this, moderately priced condominiums are also displaying robust fundamentals, with steady pricing and increasing demand from both foreign and local buyers.

What is the most resilient property sector in Cambodia?

As with many developing markets, Cambodia suffers from a lack of data transparency. We track a range of metrics to determine likely future performance, including price and rent data, occupancy levels and demand-side metrics on the size and budget of enquiries. We also take note of mortgage lending growth, approved investment into construction and complete thorough primary surveys to inform us about upcoming supply.

Which key index and metrics do you track to assess Cambodia’s real estate market performance?

Cambodia’s industrial market is one of two halves. The traditional growth sector of garments and footwear is facing increasing competition from overseas markets and pressure from changes to trade preferences – whilst the sector will remain an important employer for some time, we aren’t likely to see significant growth unless some fundamentals change. However, there is good news from a range of newer industries and from the logistics and warehousing side of the sector – where we see growing ambition and upgrading. The sector’s future is made brighter by infrastructure investment and improvements in supporting industries.

What is the outlook of the Cambodia industrial market in the next 6 to 12 months?

Whilst there has been some retrenchment from existing commercial occupiers bought about by Covid-19, over the medium term we expect to see continued expansion of existing firms, as they grow to service the increasing demand generated by Cambodia’s fast-paced economic growth.

What is your view of the commercial sector?

At this stage in its development, Cambodia’s real estate market still lags behind regional competitor markets and this means there is plenty of opportunities to add value. Improving the variety and quality of in-house amenities, adding technology solutions, thinking holistically about creating a feeling of community and the delivery of quality management services are all areas that can make a difference this is space – in some developments, we are already seeing this happening, and once other developers catch on I have no doubt we will see the whole sector start to pivot.

Do you see any type of opportunities when value adding on the properties? Let’s say residential.

There are a plethora of macro adjustments that are set to impact Cambodia’s real estate markets, including opportunities like the country’s favourable demographic profile, and the threat of climate change. Over the short to medium term, the lack of international travel and its cap on economic growth through reduced FDI flows and foreign tourism arrival numbers are clearly a concern, whilst this accelerated market contraction also presents an opportunity for buyers to find a better deal on real estate and has promoted the use and quality of technology services to the sector.
You can find more here: <a href="https://www.youtube.com/watch?v=dIhXduUZJHg&amp;t=9s" rel="nofollow">https://www.youtube.com/watch?v=dIhXduUZJHg&amp;t=9s</a>

Do you see any major Macro changes that can impact on the Cambodia real estate sector?

Phnom Penh is a city of 2 million people, it consists of a number of different districts. The core districts are home to a number of high-rise, high-end condominium projects and well specified commercial buildings, whilst the suburban districts are popular with low-rise and mid-rise residential projects, retail developments and industry. Most overseas investors focus on the core districts, which have traditionally been the centre of expatriate living in Phnom Penh. However, now-a-days the edge of the city is also up-and-coming for overseas investors, particularly due to some really innovative and attractively priced developments.
You can find more here: <a href="https://www.youtube.com/watch?v=dIhXduUZJHg&amp;t=9s" rel="nofollow">https://www.youtube.com/watch?v=dIhXduUZJHg&amp;t=9s</a>

Would you mind if you could briefly describe how Phnom Penh is made up and what are a few areas that overseas investors tend to be interested to look at?

Cambodia benefits from a few really compelling drivers of demand; firstly, it has a really young population so the economy has got a lot of legs for the future, secondly, economic growth has been strong for a long time, thirdly, the economy is heavily dollarized and all real estate transactions are carried out in USD, fourth, the market is very much still an emerging one, its still got room for growth and change that can create opportunities for those willing to step beyond the better walked paths of more developed markets.
You can find more here: <a href="https://www.youtube.com/watch?v=dIhXduUZJHg&amp;t=9s" rel="nofollow">https://www.youtube.com/watch?v=dIhXduUZJHg&amp;t=9s</a>

Cambodia real estate market has become a very hot topic among a few circles I am in. What is the reason behind this trend and how do you think it will evolve in the coming years?

Cambodia benefits from strong connections with a number of neighbouring countries, but particularly with China, who is Cambodia’s largest benefactor and a significant ally. However, Cambodia is welcoming to a wide range of investors and we have involvement from a diverse range of investors including heavy interest from Singapore, Hong Kong, Korea and Japan.
You can find more here: <a href="https://www.youtube.com/watch?v=dIhXduUZJHg&amp;t=9s" rel="nofollow">https://www.youtube.com/watch?v=dIhXduUZJHg&amp;t=9s</a>

What’s the relationship like among countries in that region? How is Cambodia situated for potential growth?

Cambodia has a great culture for expatriate and locals alike, its close knit but big and broad enough to offer ample opportunities for both work and social lives. Cambodian society remains relatively traditional, but this is starting to change as younger generations become increasingly accustomed to technology and consumer culture. The environment for expatriates is great – wonderful places to eat, drink and socialise, plenty of good quality schooling options and an increasing variety of places to shop or have a day out with the family.
You can find more here: <a href="https://www.youtube.com/watch?v=dIhXduUZJHg&amp;t=9s" rel="nofollow">https://www.youtube.com/watch?v=dIhXduUZJHg&amp;t=9s</a>

To give a better idea regarding the tenancy, how is it like to live in Cambodia? How is the culture like for local and expats? Brief insight would be fine.

The demand drivers for tenants are somewhat different depending upon the asset-type and locations, its best to speak with an experienced leasing agent to really understand the way that tenants view these aspects. For self-use, exploring the options to find the best fit for you will take some time, but like any investment, its always good to seek clear guidance and especially understand the level of finishing and the property management aspects of the project to make sure they are a good fit for you.
You can find more here: <a href="https://www.youtube.com/watch?v=dIhXduUZJHg&amp;t=9s" rel="nofollow">https://www.youtube.com/watch?v=dIhXduUZJHg&amp;t=9s</a>

How would you suggest differently for investors that are either planning to self-use or investment only?

Check out the developer’s track record, that is probably the number one tip. You want to be sure that they know how to finish a project to a standard that fits you. Get to know the asset in detail, especially its location, reputation and the key occupier types and characteristics. 
Cambodia is reasonably liberal when it comes to taxation and ownership – foreign buyers can own a unit on an effective freehold tenure within a co-owned space, so long as it is above the ground floor and not more than 70% of the building’s floor area hasn’t been sold to foreigners. So long as all relevant taxes are paid you can repatriate profits without any currency controls.
You can find more here: <a href="https://www.youtube.com/watch?v=dIhXduUZJHg&amp;t=9s" rel="nofollow">https://www.youtube.com/watch?v=dIhXduUZJHg&amp;t=9s</a>

What are some tips and advices would you suggest to the audience? Is there anything they should be aware of when it comes to investing in the Cambodia real estate market? (such as tax, vacancy rate, and ownership %)

Covid has dampened market activity, particularly in the leasing market. Rents have started to fall, particularly for serviced apartments, but so far we haven’t seen such a significant impact in the quoting prices or rents of condominiums. There are some great offers available from developers and in the secondary market, but in terms of larger assets there are still few things available on the open market. Building a strong relationship with a trusted broker will help you understand the market and spot opportunities that come up – if it’s a good deal then things are still being snapped up at a fast pace.
You can find more here: <a href="https://www.youtube.com/watch?v=dIhXduUZJHg&amp;t=9s" rel="nofollow">https://www.youtube.com/watch?v=dIhXduUZJHg&amp;t=9s</a>

How did COVID impact the market? Where are the opportunities for investors that look for during time like this?

In recent years the office market has proven to be very robust, and increasingly the industrial and logistics market is really starting to move ahead. We’ve also seen some potential in the hospitality market, of course that is over the longer term, but there are some great deals to be hand in the sector and some interesting underlying fundamentals out there. Land remains the top asset class in Cambodia, principally because it is trusted above other asset classes by local buyers – but it’s a bit more complex to buy land, which is an asset class technically prohibited to foreigners.
You can find more here: <a href="https://www.youtube.com/watch?v=dIhXduUZJHg&amp;t=9s" rel="nofollow">https://www.youtube.com/watch?v=dIhXduUZJHg&amp;t=9s</a>

Besides residential in Cambodia, what are other asset types, investment strategies, and area that have shown potential?

Do you see a foreign investors investing in Cambodia real estates? What types of investors (REITS, conglomerate, funds and so on) do you normally come across?

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