Monday, 18 February 2008

Phnom Penh hits the heights

In the market for a million-dollar penthouse suite? Thinking Kuala Lumpur, Bangkok or Singapore? Try Phnom Penh.

February 18, 2008

South Korean-funded Yon Woo Cambodia announced in January the plan to offer Gold Tower 42, skyscraper apartments from about US$500,000 (Bt16.7 billion) to $1.6 million, and the development - scheduled for final completion in 2011 - will become the tallest in the city.

The Cambodian capital's rocketing real-estate prices have encouraged construction to reach for the skies, government spokesman Khieu Kanharith told Deutsche Presse-Agentur.

"Five years ago another company began planning a 32-storey tower, which has yet to be built, on the outskirts of the capital, and we expect many more such projects," Kanharith said.

David Simister, chairman of property consultant CB Richard Ellis Thailand, agreed. He said that post-crisis Phnom Penh was now as attractive a property development destination as Ho Chi Minh City.

"Rules are quite clear on the back of a strong government. Between Thailand and Vietnam, Cambodia is quite liberal," Simister explained.

A condominium in Phnom Penh now sells for $2,000 per square metre, approximately the same as the Bt75,000 which is quoted for condominiums along Sukhumvit Road. According to Simister, demand is also strong as Cambodians are repatriating overseas earnings while the number of foreign businessmen in the city is growing.

The property market there is set to expand further with the growing tourism industry, following the expansion of the airport and the marketing of new tourist destinations.

Simister said that due to contacts for consulting and marketing services for properties in Phnom Penh his company would later this year open an office there, in the wake of others in Danang and Ho Chi Minh City.

He noted that foreign investors were now looking to do business in the city, thanks to the relaxed market requirements. Phnom Penh's maximum lease for foreigners is 99 years, against a maximum 70 years in Vietnam and 30 years in Thailand. "In Thailand, the ownership issue is not helpful for foreigners. Hopefully the new government will look into that," he said.

Kim Tae Gon, general manager of Yon Woo Cambodia, told DPA: "The investment climate is good. Cambodia is eager for development. We have sold 40 per cent of our apartments in Gold Tower 42 off the plan already, and the majority of buyers are Cambodians, although Koreans, Chinese and British have also bought," he said.

Cambodia's building industry is booming on the back of double-digit growth and hopes that revenue - and businesses - will begin rolling in on the back of the expected oil and mineral revenues due to be tapped within the next two to five years. A stock market is also in the offing within a year.

Achara Deboonme

The Nation

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