The coastal province of Kep in southern Cambodia, only 146 kilometres from Phnom Penh, is set to attract increased investment in the near future due to low land prices compared with its seaside neighbour Sihanoukville – and it has undeniable potential for eco-tourism.
Kep is only 125km from Sihanoukville and only 44km from Kampot, another province seeing increased interest from hospitality and tourism investors.
The Provincial Governor of Kep, Ken Satha, recently told the media: “We are in the stage of working out a master plan project for our province’s development which will emphasise eco-tourism.
“Although we haven’t yet got an official agreement from the Ministry of Land Management, Urban Planning and Construction, we are still progressing with our master plan to develop
more infrastructure [in Kep].”
Sok Ken, the founder of Kampot Property, said: “Kep is one of the country’s attractive coastal tourist destinations, welcoming as many local and international tourists as its coastal peers. Even though there are now not many major projects underway in Kep, this attractive coastal province is likely to be the next real estate development target for foreign investors owing to its cheaper land price and tourism potential.
“After Sihanoukville and Kampot see full development and land price reaches its peak, investors will look for similar potential investment opportunities and Kep is the most favourable place for investors next real estate development.
“At the moment, the cheap land prices in Kep is a very good opportunity for those investors looking for potential return on their investments.
“Land prices around the White Horse roundabout near the highway in Kep are now priced between $35 and $40 per square metre, while land prices around the Kep market are between $90 and $150.
“Land prices around the coast are more than $200 per square metre,” added Mr Sok.
Mam Sereypanha, the Chairman and CEO of Easy Realty Property Investment, said: “At present, land prices around the coast are between $150 and $400 and other parts of the province are below $100.
“Buyers mostly purchase land for investment such as building hotels and resorts to accommodate tourists.”
Mr Mam said foreigners tend to relocate from Siem Reap, Sihanoukville and Kampot to Kep province for a more quiet life, buying cheaper land for residential purposes. Improving infrastructure such as road expansions around the province, together with big hotels and higher quality resorts, offer more incentives for these types of investors to move into Kep homes.
“In recent times real estate transactions in Kep have risen 20 to 30 percent thanks to its future eco-tourism potential and the government’s willingness to develop more infrastructure in the province to attract more local and international tourists,” he said.
“Real estate prices in Kep might rise further, especially for those wanting to buy land for residential purpose.”
Kep is especially attractive for investors now as land prices in the nearby beach-city of Sihanoukville are skyrocketing, buoyed by an inflow of Chinese investors who are pushing prices higher than local and non-Chinese investors are willing to pay.
Now land price along the coast in Sihanoukville are much higher than that in Kep province, mainly due to the price speculation from deep-pocketed Chinese investors.
This will push other investors to pull out of Sihanoukville and consider investing in similar potential coastal provinces such as Kep and Kampot with less competition and cheaper land prices.
According to Brad King of Koh Rong Property, speculation from investors, in particular the Chinese, “is pushing Sihanoukville land prices higher than similar plots of land along the Thai and the Philippine coastlines”.
“This is stunting ongoing investment on the mainland and price speculation is becoming ridiculous. Average land prices are over $1,000 [per square metre] along the Sihanoukville coastline,” said Mr King.
Real estate agents in Kep are optimistic that with the government’s plan to build more infrastructure in the province – such as road expansion, eco-tourism protections and seaport projects underway in neighbouring Kampot – will result in more tourists coming into the two provinces very soon.
More tourists in Kep will drive more residential development projects in the province such as hotels, resorts and guest houses, eventually pushing general real estate prices higher, according to the local real estate agents.
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Vat Vin is an editor @ Realestate.com.kh