A hard hit on real estate sector in Cambodia during Covid-19
PhD Kim Heang, CEO of Khmer Real Estate, said the impact of Covid-19 crisis has strongly affected Cambodian economy, but we have not known the estimated size of it yet.
The growth of Cambodian economy depends partly on foreign direct investment (IDF), including real estate. Some investors invest in big projects in Phnom Penh and some others go to the suburbs or provinces.
Covid-19 has obstructed cash flow from overseas because foreign investors can’t enter Cambodia as the result of travel restriction. Although Cambodian has not completely delayed all flights, some other countries imposed strict travel ban across the world. Therefore, some investors could not be able to come and invest in Cambodia.
“In this hard situation, no matter what, some investment projects in Phnom Penh are stuck automatically. Even though some businessmen who have good relationship with foreigners regrading investment are also suffering from coronavirus,” said Heang.
“When we talk about real estate sector, condo projects gain a lot of interest from foreigners. Although I have no data in hands, I can say that 90 per cent of condo projects are suffering from this crisis because the sales is so silent. Similarly, the investment on Borey development projects are falling as well,” he added.
Talking about plot lands, Mr. Heang said we need to understand that those who invest in plot lands are lower middle-income. It means these people are usually factory workers, self-employers, and civil servants. Besides, Covid-19 not only affects real estate investment projects but also factories, hotels, and many businesses. As a result, plot land buying has slowed down.
Covid-19 has affected almost all sectors in Cambodia and the economy will take time to bounce back.
By: LUNG Vannak