Real estate sector bounces back in Cambodia

Real estate sector bounces back in Cambodia

Roger Pettingell Sarasota Real Estate

With a projected 5.3 percent growth of the Gross Domestic Product (GDP) in 2022, the Cambodian economy is rebounding fast from the Covid-19 setbacks and the Kingdom is now hailed as the most attractive investment location in Southeast Asia. In over a decade, the real estate sector in the country has grown leaps and bounds and is considered one of the driving forces taking the economy forward.

For the first time since the Covid-19 outbreak, around 100 stakeholders in the real estate sector came together at a property EXPO 2022 organised by realestate.com.kh in partnership with Khmer Times at the Premier Centre at Sen Sok in Phnom Penh for the last two days in what is considered as a turning point for the sector post-pandemic.

The EXPO 2022  not only attracted a large number of visitors but hectic B2B meetings were held with many developers offering customers attractive deals for property purchases. In an exclusive interview with Khmer Times on the sidelines of the expo, Tom O’Sullivan, the CEO of realestate.com.kh said that the real estate market, which suffered a severe blow caused by the Covid-19 pandemic, is on the path of recovery.

“But we are still waiting for China to fully reopen and definitely hope that in the second half of the year we will see some aggressive buying in the real estate sector. More investors from Europe, the United States, Korea, Japan, Singapore and Malaysia have also evinced interest in buying property in Cambodia. This has also boosted the confidence of local buyers,” Tom said.

Replying to a question, he said there is definitely an issue of oversupply in the market, especially condominiums. “These projects were launched during the pre-Covid years when the market was still hot. Now, they have to think more creatively to sell these units,” he said.

According to Tom, the rising cost of raw materials is a matter of concern for the construction sector and he termed it as a new pressure. But it is also a matter of relief that new projects are now being announced in Cambodia like holiday homes. “But we have to say that it is not super aggressive and that is good to some extent as it will check oversupply.”

He also added that foreigners are now increasingly using the provision of buying landed property through trust companies in Cambodia.

When asked how his company managed the Covid-19 crisis, Tom said they had to take a cautious approach. “We changed our business model to some extent. For example, we stopped to collect a marketing fee and instead suggested a success fee which the retail agencies and developers paid when a deal is closed. Some developers also pay us a marketing fee for promotions,” he said.

The company also had to reduce its staff strength in the wake of the Covid-19 pandemic. The company which employed about 90 people reduced its strength to 50 after the outbreak of the pandemic. “Now we are in the process of rebuilding our team,” the CEO said.

Another change in the operational aspect of realestate.com.kh, founded in 2009, was to focus more on online than offline. “We have over 150 firms registered with us online now,” he said.

When asked about the prospects for the next year, Tom said everyone has a close watch on international events. “For Cambodia, the tourism sector is recovering. So are agriculture and manufacturing. The real estate sector is also changing. It is not fully dependent on the Chinese market anymore. Other markets are also showing interest in the Cambodian market and that is good news,” he said.

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