Property News Roundup 12th August 2024
We’re delighted to share the weekly news highlights below.
- Cambodia PM launches project linking Mekong river to sea via canal
Cambodia’s Prime Minister Hun Manet launched a US$1.7 billion canal project on August 5, aiming to link the Mekong River to the sea. The 180km Funan Techo canal, expected to be completed by 2028, is intended to reduce Cambodia’s reliance on Vietnamese ports. The project has raised concerns about its economic feasibility and environmental impact on the Mekong River. Villagers along the canal’s route expressed worries about compensation for expropriated land. The canal, partly financed by China, has also sparked fears in Vietnam about potential military use by Chinese warships. Deputy Prime Minister Sun Chanthol promised fair compensation and highlighted the project’s potential to create thousands of jobs.
August 6th 2024 | The Straits Time | Link: t.ly/0k3sb
- Foreign tourists now free to take pre-wedding photos with their outfits at Cambodia’s Angkor
Foreign tourists can now take pre-wedding photos for free at Cambodia’s Angkor Archaeological Park with their own outfits. This initiative, announced by Prime Minister Hun Manet, aims to attract more international visitors to the UNESCO-listed site. Tourists must adhere to the park’s code of conduct, avoiding revealing or inappropriate attire. Media outlets can also take photos for free but need prior permission from the APSARA National Authority. Commercial photoshoots and drone photography still require permission and fees. The park, home to 91 ancient temples, generated US$27.2 million in ticket sales from January to July 2024, a 33.8% increase from the previous year.
August 6th 2024 | The Star | Link: t.ly/hjMvg
- Cambodian banks’ bad loans ratio to peak at 7.7% in 2026
Cambodian banks’ bad loans are expected to peak at 7.7% in 2026 due to lingering effects of the pandemic on tourism and real estate sectors. S&P Global Ratings warns that asset quality will deteriorate over the next two years. Non-performing loans (NPLs) are projected to increase in 2024-2025, reflecting concentrated loan books in lagging sectors. Tourism spending remains below pre-pandemic levels, affecting related sectors that account for 17% of bank loans. Real estate, comprising 20% of lending, is also struggling, with condo prices dropping to 2013 levels. The Cambodian government is investing in infrastructure and manufacturing to diversify economic drivers and improve the banking sector’s risk-reward scenario.
August 6th 2024 | Asian Banking & Finance (ABF) | Link: t.ly/1IpyS
- 4. Real estate services licensing digitalized
The Real Estate Business and Pawnshop Regulator (RPR) has introduced a digital procedure for applying for professional certificates and licenses for real estate services in Cambodia. Starting August 1, all real estate sector parent companies and branch offices can apply online through the RPR’s Information Technology System Portal. Physical submission of original documents is no longer required; applications can be submitted online using the ‘CamDigikey’ app. This new process aims to reduce costs, increase ease of application, and improve compliance across the sector. The transition aligns with Cambodia’s Digital Government Policy 2022-2035. The regulation, Prakas 64, governs real estate services, requiring licenses for management, valuation, and agency services, with fines for non-compliance.
August 7th 2024 | Khmer Times | Link: t.ly/GCWGp
- 5. How Has Cambodia’s Real Estate Sector Performed At the 2024 Half-Way Mark
Cambodia’s real estate sector saw a 23% decrease in approved construction projects and a 20% drop in total project value in the first half of 2024 compared to 2023. Despite this, there was a 23.1% rise in the import of construction materials and a 4.7% increase in domestic cement production. Phnom Penh’s office rental occupancy was 61.8%, with rental rates between USD $25-30/sqm, while the retail sector faced challenges with an occupancy rate of 58.7%. The condominium market expects 14,000 new units by the end of 2024, with prices for affordable and mid-range condos down by 9.9% and 5.9%, respectively. New landed property launches slowed, with 29 projects completed, and the industrial sector saw growth driven by manufacturing. Cambodia has 28 operational Special Economic Zones, with significant investments in infrastructure projects planned until 2033.
August 7th 2024 | Khmer Times | Link: t.ly/vVubo
- 6. Asia Real Estate Investments Drop 13% Amid Delayed Rate Cuts and Market Repricing
Real estate investments in the Asia Pacific dropped by 13% in Q2 2024, with a total investment volume of $22.9 billion. Investors are cautious due to delayed interest rate cuts and economic volatility, awaiting clearer signals from central banks. Hong Kong experienced the most significant decline, with investment volumes falling by 54% amid economic difficulties and geopolitical tensions. Henry Chin of CBRE expects further market repricing in Hong Kong, mainland China, and Singapore, potentially offering more attractive entry points later in the year. In contrast, Australia and New Zealand are nearing the bottom of their pricing cycles, suggesting potential stabilization and buying opportunities. This trend reflects broader market adjustments aligning prices with underlying economic realities.
August 7th 2024 | Construction & Property | Link: t.ly/7QC3k
- 7. New ferry to enhance student safety in Kampong Thom
A new ferry has been introduced in Kampong Thom province’s Prasat Sambor district to enhance student safety following a tragic drowning incident in June. Prime Minister Hun Manet provided the vessel, which is now ready for use, as announced by the Ministry of Public Works and Transport on August 7. The ferry measures 18.5m in length, 3.60m in width, and has a maximum capacity of 13.5 tonnes, capable of carrying a family car, motorcycles, and 35 passengers. Prasat Sambor district governor Khim Sok Kheang highlighted the dangers students face using small boats, emphasizing the ferry’s role in safer transportation. The vessel has not yet been handed over to the community but will be soon, facilitating travel for residents in Chhouk and Sroeung communes. Additionally, the Ministry of Mines and Energy inspected several ports to assess the need for more ferries in the region.
August 8th 2024 | The Phnom Penh Post | Link: t.ly/4SdNF
- 8. In July, Cambodia approved 44 new investments worth $ 396 million
In July 2024, the Council for the Development of Cambodia approved 44 new investment projects worth US$396 million, creating 25,000 jobs. Among these, 31 projects are outside Special Economic Zones (SEZs) and 13 within. Kampong Speu province attracted the most investments with 13 projects, followed by Takeo with seven and Svay Rieng with six. Chinese investment dominated, accounting for 68.06% of the total, while domestic investment made up 14.24%. Notable projects include a US$21 million expansion for a laundry, dyeing, and printing factory in Kampong Speu, and a US$100 million establishment of the Koh Kong Che Cheang SEZ. Additionally, a US$26 million food processing plant in the same SEZ will create 194 jobs.
August 8th 2024 | Construction & Property | Link: t.ly/8-z5s
- 9. Cambodia’s Four Provinces in the Development Triangle Secures US$ 3.7 Billion in 105 Investment Projects
In the Development Triangle, Cambodia’s four provinces have secured 105 investment projects worth US$3.7 billion, creating over 160,000 jobs. Kratie leads with 42 projects, generating over 60,000 jobs, followed by Stung Treng with 16 projects and nearly 30,000 jobs, Ratanakiri with 28 projects and 40,000 jobs, and Mondulkiri with 19 projects, creating over 30,000 jobs. Of the 105 projects, 80 are in agriculture, 5 in industry, 19 in infrastructure, and 1 in tourism. Vietnam contributes 32% of the investment, Cambodia 26%, China 22%, with the rest from the UK, USA, Singapore, Korea, Malaysia, Australia, and India. This announcement was made by Dr. Ky Sereyvath from the Royal Academy of Cambodia on 2 August 2024. The Development Triangle’s significant investment and development highlight its growing economic potential.
August 8th 2024 | Construction & Property | Link: t.ly/iXlSV
- 10. National Road 33 Rehabilitation Project (Kampot-Chrak Lok) Achieved 90.84%
The rehabilitation of NR No. 33, connecting Kampot to Chrak Lok, is 90.84% complete as of July 2024. This 52.57 km project, passing through Kampot province, Kep City, and Damnak Chang Eur district, was inspected by H.E. Pal Chandara and technical teams from CRBC and Guangzhou on 7 August 2024. The inspection covered critical areas like the Kbal Romeas Bridge, canal locations, the White Horse roundabout sidewalk, and road markings to ensure safety and quality standards. Secretary of State Pal Chandara stressed the importance of adhering to technical specifications for public safety. Funded by a concessional loan from China and additional Cambodian government budget allocations, the project addresses various impacts and taxes. The NR No. 33 project aims to enhance transportation links, improving connectivity between Cambodia and Vietnam through Teuk Chhou and Kampong Trach districts.
August 9th 2024 | Construction & Property | Link: t.ly/UBG47