Premier pushes skyscrapers

Vattanac Properties: The Vattanac Capital Tower would be Cambodia's latest skyscraper.

Vong Kokheng and Don Weinland
Friday, 10 February 2012
The Phnom Penh Post

Prime Minister Hun Sen yesterday promised accolades to the builder of Cambodia’s next skyscraper, while downplaying disputes on tall buildings near the Kingdom’s monuments.

Construction investments in Cambodia increased by about 105 per cent in 2011, hitting US$1.73 billion, according to Hun Sen. “Currently, there are no problems with skyscrapers [in Cambodia] and I declare that I will grant a medal to the builder of the highest skyscraper,” the premier said before hundreds of government officials at the opening of a new Ministry of Land Management, Urban Planning and Construction building on the capital’s Monivong boulevard.

He also rebuked “extreme conservatism” on the building of skyscrapers near the Royal Palace, deeming anywhere except near the airport open for potential building projects.

Prices for office space fell on oversupply last year, real estate insiders have said, and the trend could accelerate with the opening of the Kingdom’s third grade-A office block, the 38-storey Vattanac tower, expected to be finished in October.

The price of A-grade office space fell by $2.5 per square metre to $21 in 2011, the Post reported last week. Phnom Penh Tower, which opened last year, had about a 50 per cent occupancy rate in January.

Keuk Narin, vice president at Asia Real Estate, said yesterday that builders should focus on grade-B office space to accommodate the expected increase in small-and medium-sided enterprises in the Kingdom.

“The price could stagnate this year and could decrease for some new buildings,” he said. “I don’t think skyscrapers are the priority for the builders now.”

The expected opening of the Cambodian Securities Exchange could create higher demand for the A-grade skyscraper space, he added.

Prices will remain stable in 2012 until new developments currently under construction open, Sung Bonna, president of the National Valuers Association of Cambodia, said yesterday. “Now it’s ok, but we are a little concerned when the Vattanac tower opens,” he said.

An increase in competition among developers, however, would improve the quality of construction projects, Sung Bonna said. International investors have showed interest in Phnom Penh’s Gold Tower 42, Sung Bonna said. Developers Yonwoo Cambodia would have potential buyers should it look to sell the partially constructed building.