CAMBODIAN RESORT MARKET BOOSTED BY INCREASING NUMBER OF INTERNATIONAL ARRIVALS MOVING INTO 2014
The number of tourist arrivals to Cambodia has increased significantly in the past four years following a period of uncertainty within the sector, adversely affected by the effects of the global economic crisis throughout 2008 and 2009.
Cambodia had received over three million arrivals by the end of September, 2013, with almost half of these flying into one of Cambodia’s two International Airports. With the ever increasing numbers in international arrivals, Cambodia’s resorts are now becoming a favorable investment opportunity in Cambodia.
The high number of visitors has continued to increase, despite the ongoing political unrest in the capital, Phnom Penh, which has remained predominantly peaceful since the General election of July 2013.
Traditionally tourists have arrived to Cambodia at Siem Reap International Airport, attracted by the Angkor Wat temples, before moving on in some cases to Phnom Penh. In more recent years the Ministry of Tourism has pushed to diversify Cambodia’s ‘Tourism Trail’ and encourage the development of the coastal region as a new tourist destination. In 2011 Sihanoukville was admitted to the prestigious ‘Most Beautiful Bays in the World Club’ raising its profile internationally. The area has established itself as South East Asia’s latest cruise destination, with ships arriving directly from Indonesia, Singapore, Thailand and Vietnam.
The increasing numbers of international visitors has driven a demand for western style boutiques and resort style accommodation within Cambodia, with the first three quarters of 2013 experiencing an increase in international visitors of 18.6% Y-o-Y.
A resort that has stepped in to meet the demand of the increasing international elite traveler in this region is the award winning Song Saa Private Island – Cambodia’s first luxury private island. Opening in March 2012 it offers five star villa accommodation, with a focus on sustainability and environmental awareness and a slogan of ‘Luxury that Treads Lightly…’ The resort also offers villas for sale for private ownership, with the owners returns based on the success of the resort, allowing for 30 days usage each year and a guaranteed yield of 8% for the first five years.
In 2013 the island of Koh Russey located approximately 10 kilometers from the coastal town of Sihanoukville was confirmed by Alila Hotels & Resorts to be the first internationally branded island resort to be built in Cambodia, developed by CityStar. CityStar plan to develop a low density project ensuring a high level of exclusivity and privacy with only 15% site coverage, comprising a total of 227 units (including 48 hotel suites) and luxury resort facilities and services. The first phase of the development is expected to complete in 2015, with the project set to become a pioneering development on Cambodia’s coastline.
Other developers that have been attracted to the region are KPIG on the Morocot Island development and Queenco Leisure Ltd who have a number of land plots close to the up and coming Otres Beach. A number surrounding island and land plots have been bought by developers who are now seeking investors to build resorts and infrastructure to support the influx of visitors in the area. Currently CBRE are working with the Royal Group in attracting investors to this unparalleled opportunity in the Gulf of Thailand.
Royal Group have signed a 99 year lease with the Cambodian Government for Koh Rong, to develop the island into ‘Asia’s first environmentally planned Resort Island’ and initiate high end international tourism on Cambodia’s coastline. The key attributes to this island are its location, size and natural beauty, with the construction of an airport planned in the first phase of development, Koh Rong is only approximately an hour flight from Bangkok and Singapore.
Both domestic and International airlines have recently announced plans to launch new flights from Siem Reap during the tourist season, with construction of the New Siem Reap International Airport (NSRIA) due to commence in early 2014, allowing for substantially higher numbers of tourist to be welcomed to Cambodia in the near future, further driving the need for developments such as Alila Hotels & Resorts and Royal Groups Koh Rong Island development.