Four pillars: construction / What keeps property developers flocking to Cambodia

Posted on: April 29, 2018 | Special Reports

Tom O’Sullivan, director of renowned estate agent realestate.com.kh, discusses the Kingdom’s property sector

Tom O’Sullivan believes that Cambodia and China’s close relationship gives Chinese investors a lot of confidence in the market

What’s your current assessment of the Cambodian property market?
I thought the upcoming election would have had more of an impact. When I was putting together our strategic plan for this year, I took it heavily into consideration. But it doesn’t seem to have deterred international investors – and when we’re talking about international investors, we’re generally talking about Chinese investors. We’re actually generating more leads on our website now than this time last year.

Testament to the market’s strength, Prince Real Estate is launching three sizeable projects this year, Xinghui Property is launching a huge project in the first half of the year, and R and F Properties, another listed Chinese developer, has just entered the market as well.

In your opinion, why is Cambodia an attractive proposition for property investors?
Political stability is key but, more importantly, growth is not forecast to slow down either. I think the fact that the local government and the Chinese government are very closely aligned also gives Chinese investors a lot of confidence in the market.

Something else that we’ve noticed recently is that the idea that local Cambodians don’t buy condos is a myth. As major projects, such as the Bridge on Koh Pich, have come close to completion, we’ve generated more local leads on these projects than international leads.

What that says to me – and it’s common in other markets, too – is that local buyers hold off on purchasing condos because they’ve seen lots of developers fail to deliver on their promises in the past and don’t want to take a leap of faith. They’d much rather wait until projects near completion before buying units.

Which areas do you believe have the most potential for growth in the future?
I think the two biggest growth areas are Sen Sok, around the cash-and-carry wholesaler Makro and near to Aeon 2 shopping mall, and Chroy Changvar, where SH Condos, UK Condos and other developers are selling condos priced between $22,000 and $80,000.

It helps that, in Chroy Changvar, a lot of infrastructure is being built to service the new boreys [gated communities] and satellite cities. When Sunrise Hospital opened in late 2016 that was a big boost, too. As soon as the bridge is redone, I think Chroy Changvar will be a pretty active area.

This article was first published in Globe Media Asia’s Focus Cambodia 2018 magazine