Increase in Special Economic Zone Occupancy
CBRE in the news: Owen Willaims a Surveyor at CBRE has produced this months monthly ‘Marketview’ report, this month focusing on the Industrial sector. The report has been used a the basis for the following article in the Property section of the Phnom Penh Post:
The total occupancy rates in Phnom Penh’s Special Economic Zones (SEZ) have reached 50 percent in 2011, . The report stated that seven SEZs are now operational in Cambodia, while 15 remain in the development pipeline.
The Government has started to establish SEZs in order to attract foreign investors to Cambodia, especially near the Kingdom’s borders, according to Nguon Meng Tech, general director of the Cambodia Chamber of Comerce. They wanted to invest in those [border] areas because it was easier to do business, and because of the tax exemption in those regions, he said at a seminar earlier this month. Improveing political, economic and social stability, coupled with the government’s efforts to encourage further investments has led to and increase in occupancy rates, Nguon Meng Tech added. Despite restrictions on foreign land ownership, there are no limitations on foreign-owned companies. Among the benefits of the lease is a corporate income tax of 9 percent, full import duty exemption on raw materials, machinery and equipment and a nine year tax holiday, accodrding (demand is accelerating thus helping the growth of the sector) the CBRE report. The total values for investment projects in the SEZs increased 683 percent year-on-year in 2011, hitting US$715.25 million, according to figures released by the Council for the Development of Cambodia. Some insiders said, however, that while and additional 15 SEZs will enter the market in the coming years, supply is still lacking. “Demand is accelerating thus helping the growth of the sectoe although this could decelerate due to the low level of supply in the industrial rental market where demand outweighs supply rents will grow,” said CBRE surveyor Owen Williams. He added that SEZ’s are offering a good return for investors with yields reaching double digits.
CBRE continue to be at the forefront of the real estate market in Phnom Penh and Cambodia.