China is fueling a property boom in this Southeast Asian country

Slowing sales and rentals in Cambodia raise concerns about sustainability

New York Weekend Edition /
Sep.September 15, 2018 08:00 AM

The city of Phnom Penh in Cambodia (Credit: iStock)

One of the fastest property booms in the world is happening in Cambodia, largely thanks to buyers and builders from China.

Phnom Penh, the country’s capital, is going through a rapid transformation, with high-rise condominiums replacing heritage sites, according to Bloomberg. However, with Cambodia’s median household income at just about $11,000 per year, sales and rentals have already started slowing down.

The city is an example of wealthy Chinese developers looking for foreign governments to offer up prime land for investment. Several of those bets have been suffering lately as governments that approved them get voted out, and the developments themselves lead to rising prices and resentment among locals.

The pipeline of projects backed by China does not appear to be slowing down in Cambodia, though, as Prime Minister Hun Sen maintains close ties with China and extended his 33-year reign in July after disbanding the main opposition party.

Mey Kalyan, senior adviser to the Supreme National Economic Council, told Bloomberg that the country was still concerned about relying on China too much.

“We must come up with strategies to manage this investment to avoid problems in the future,” he said. “We should not allow just one country to dominate investment.”

Average condo prices in the capital were $3,200 per square meter, and the supply of condos is expected to double to more than 20,000 units this year.

Projects include a $2.7 billion, 133-story Twin Tower World Trade Center and 24 high-rise buildings along the riverbank in Phnom Penh. The government also wants to build a new $80 billion capital north of Phnom Penh dubbed “Samdech Techo Dragon City.” [Bloomberg]Eddie Small


Related Articles

arrow_forward_ios
East Hampton Town Supervisor Peter Van Scoyoc and 350 Pantigo Road (Zillow, Getty, Town of East Hampton)
Hamptons town could buy former department store land to build homes
Hamptons town could buy former department store land to build homes
From left: Silverstein Properties CEO Marty Burger; BedRock Real Estate Partners co-founder Tracey Applebaum; Council member Julie Won; a rendering of Innovation QNS in Astoria (Getty, BedRock Real Estate Partners, New York City Council)
Council approves Silverstein, BedRock’s $2B Innovation QNS
Council approves Silverstein, BedRock’s $2B Innovation QNS
Silverstein Properties' Marty Burger, City Council Speaker Adrienne Adams, BedRock Real Estate's Tracey Appelbaum, City Council member Julie Won and Mayor Eric Adams with rendering of Innovation QNS (Silverstein Properties, Getty, New York City Council, Innovation QNS)
5 lessons from Silverstein’s Astoria deal
5 lessons from Silverstein’s Astoria deal
Long Island developer Robert DiNoto (Getty, Google Maps, Robert DiNoto)
Tri-state roundup: LI developer divests after guilty plea
Tri-state roundup: LI developer divests after guilty plea
Crime, money laundering,
Scammer posing as real estate developer sentenced for laundering
Scammer posing as real estate developer sentenced for laundering
(Photo Illustration by The Real Deal with Getty)
For richer or poorer: The hidden cost of low-income housing
For richer or poorer: The hidden cost of low-income housing
Hudson Companies CEO David Kramer and a rendering of the planned project at 27-45 North Main Street and 28 Adee Street in Port Chester (Getty, Hudson Companies)
Hudson plans Port Chester mixed-use development
Hudson plans Port Chester mixed-use development
960 Franklin Avenue (Google Maps, Getty)
Hager buys controversial site by Brooklyn Botanic Garden
Hager buys controversial site by Brooklyn Botanic Garden
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...