CBRE Cambodia is delighted to present our Weekly Property News Round-up for April 30th, 2020.
Parkson Cambodia Ordered to Pay USD14
The Phnom Penh Post – April 28th, 2020
Phnom Penh Municipal Court unveiled their verdict on April 22nd, 2020, ordering the Malaysian retail group Parkson Holding Bhd’s Cambodian unit (PCCO) to pay USD144.5 million in damages to its Lessor, Hassan (Cambodia Development Co Ltd (HCDC). In the verdict, PCCO was ordered to relinquish its security deposit and advance payments amounting to USD4.49 million. The ruling follows a petition was filed by HCDC in December 2018, which sought compensatory damages amounting to USD12.44 million. PCCO attempted to dispute the jurisdiction of the Phnom Penh Municipal Court in hearing the case but failed. According to the statement published by the Phnom Penh Municipal Court’s verdict on Monday, “Prior to the judgement, Parkson Cambodia had filed an appeal motion to the Cambodia Appellate Court to transfer the jurisdiction of the Phnom Penh [Municipal] Court to hear Case No 2577 to SIAC Arbitration jurisdiction. The appeal motion is currently pending in the Cambodia Appellate Court.”.
CBRE: Retail Rental Price Sharply Dropped While the Supply Increase
Construction Property – April 29th, 2020
According to the real-estate firm CBRE Cambodia, retail rents witnessed a sharp downward adjustment during the first quarter of 2020. Quoting rents at community malls shrank 9.2 per cent while prime retail podiums witnessed a 10.5 per cent decline. The declining figure caused by turmoil in the wake of COVID-10 has softened retail footfall significantly. In response to the outbreak, some store expansion plans have been put on ice. CBRE Cambodia has predicted that the market will begin to show signs of recovery during the second and third quarters of 2020, assumed the situation remains stable.
Cambodia Logged 21 Per cent Increase in Inflow of FDI into the Real Estate Sector in 2019
Khmer Times – April 28th, 2020
In 2019, Cambodia observed an estimate of more than USD427.3 million in foreign direct investment into the real estate sector, according to data published in the NBC’s Annual Banking Supervision Report 2019. The report was issued on April 27th, 2020, and notes that China constituted the greatest share of investment into Cambodia. China invested 58 per cent of the total real-estate FDI, followed by Singapore at 15.2 per cent. The United States attained the third spot with total investment of approx. USD 53.5 million.
Cambodia’s Export to Thailand Up 115% in Q1
AKP – April 27th, 2020
Cambodia’s exports to Thailand exhibited healthy growth in the first three months of 2020, despite the outbreak of COVID-19. Between January and March 2020, Cambodia exported products to Thailand valued at USD612 million, up 115 per cent compared to the same period last year. However, Cambodia’s import figure showed USD1,891 million worth of goods were imported from Thailand, a 17 per cent hike. Bilateral trade between the two countries grew 31 per cent over the first quarter. Cambodia principally exported raw agricultural materials, and imported energy resources, agricultural fertilizer, food supplies, and cosmetics from Thailand. 2019 trade volume between the two countries grew by 12 per cent, reaching USD9.4 billion respectively.
Real Estate Shows Hit by Pandemic
Khmer Times– April 27th, 2020
Borey Property Show, a popular real-estate exhibition, has been rescheduled due to the outbreak of COVID-19. Mr Thomas O’Sullivan, CEO of property portal realestate.com.kh, said that for the safety of the exhibitor, attendees and everyone involved in the organized event, he had decided to postpone the exhibition to a later date. He continued that the pandemic has pressured many property developers to temporarily close showrooms, with others seeing slower construction progress. However, some developers are pushing on with marketing plans, particularly with Khmer New Year promotions aimed at stimulating sales.
Phnom Penh Office Rental Rates Begins to Soften
Property Area (Khmer) – April 30th, 2020
Real estate experts said the office sector witnessed downward adjustments of between 10 and 15 per cent by the fourth month of 2020. Mrs Ann Sothida, Managing Director of CBRE Cambodia, mentioned that the ongoing pandemic has caused the office rents to soften following tenant’s requests. However, some landlords have willingly reduced rental rates for the existing tenants to assist with cash-flows, while at the same time enticing new tenants. She continued that the first quarter of 2020 observed no new centrally owned office building completions or launches. However, one strata title office “Central Capital Tower” located in Toul Kork district launched sales during the first quarter.
1,200 Jobs to be Created by Shoe Factory in Kandal Province
Khmer Times – April 29th, 2020
A new shoe factory has been approved by the Council for the Development of Cambodia (CDC). The CDC announced the new investment in a recent press release. Located in Kandal province, the newly approved project includes total investment capital of USD5 miilion and is estimated to generate some 1,209 jobs. The investment showns the persistence of investment confidence in Cambodia’s market, despite the outbreak of the COVID-19 virus.
Logistics Providers in Cambodia Face Bankruptcy Because of COVID-19
The Phnom Penh Post – April 26th, 2020
Cambodia Logistic Association (CLA) showed concerns over impacts on the logistics sector bought about by the pandemic. The association said “We face imminent bankruptcy while some have already folded and declared they are bankrupt”. Sin Chanthy, president of Cambodia Logistics Association, stated that the pandemic has weighed heavily on the logistics and transportation sector. CLA is soliciting assistance from the government and relevant stakeholders.
See also our previous weekly news round-up: