Teng Rithy, founder and director of Property Investment Realty Partner, has over 10 years’ experience in the real estate industry, and is well regarded as an authority on investment in the kingdom’s booming real estate sector.
During the Cambodia Real Estate Show 2 held on October 6-7 at NagaWorld, Mr Rithy delivered a seminar focused on giving practical advice to Cambodians seeking a sustainable home investment.
To begin with, Mr Rithy provided an analysis of the key areas of development in the Cambodian capital. He further highlighted the importance of following Phnom Penh’s 2035 Master Plan, in order to make a successful investment in the property market.
The Master Plan was initially announced in October 2005 by the governor of Phnom Penh to highlight the principal areas and development plan of the capital. The plan is anticipated to continue developing until 2020. Mr Rithy highlighted the following key developments areas and their purposes, based on the Master Plan, thus far:
1. Preak Pnov: Facilities development and the development of the administration business area.
2. Chroy Changva: Development of commercial, office and tourism work.
3. Areyksat: To become an established entertainment centre and the development of jobs and necessary facilities.
4. Boeung Kak: To continue to build commercial offices of international standards and improve tourism development in the area.
5. Triangulation area: Focus on improving harbours and becoming an area of potential for large-scale developments.
6. Chom Chao: The ultimate goal is to become the ‘service town’ for the commodities of business and working.
7. Chbar Umpao, Boueng Snao: To become the forefront area of both commerce and tourism
8. Takhmao, Chak Angrae: A prime area for work institutions and a focus on entertainment and lifestyle.
Mr Rithy believes that before making any investment in a particular area, it is vital that the prospective investor is aware of the relevant city’s Master Plan, as it enables an informed investment in an area where future benefits can be reaped. He believes that an uninformed decision and disregard for these vital plans can lead to the failure of an investment.
From Mr Rithy’s perspective, the development areas in Phnom Penh have so far followed the Master Plan. For example, LYP Group has already built LYP bridge and has been developing other projects in Prek Pnov, redeveloping the area into a transportation hub of Cambodia. Likewise, in Chroy Changva, Oknha Pung Kheav Se, a renowned business tycoon has been developing Chroy Changvar Satellite City, and other Borey projects have also been developing in that area.
Furthermore, 111.6 hectares of Phnom Penh City Centre is being developed in Boueng Kok area and is set to become the capital’s Central Business District where modern business, innovation and international-standard infrastructure will meet.
Mr Rithy emphasised that every real estate investor must follow and understand the city’s Master Plan as he sees it as the “backbone of investment”.
“If we do not follow the Master Plan, our investment is doomed to failure. For example, if you want to build a 30-storey condominium and buy land in the area that there is a height restriction for the building, this means that you are investing in the wrong location and will face trouble with your investment,” Mr Rithy stated.
He continues: “For home buyers, If you buy a residential project, you should look for renowned developer building a project which can provide a “one-stop” living environment with facilities such as schools, hospitals, banks, markets, offices, restaurants and gym etc onsite or in the area. Some developers do not focus on these facilities, which is a reason why their project is not a success and there are not many clients interested in their project.”
As a developer, before construction of a residential project, Mr Rithy believes the focuses should be on the environment (fresh air), safety (quality of building) and facilities such as gardens, swimming pools and easy water, electricity and sewage system. Good management and economic efficiency are critical factors as well. “Sustainable home living means that you can live in that home for a long time – and with pleasure,” according to Mr Rithy.
One project that Mr Rithy has been directly involved with is The Mekong Royal project located along National Highway 6A. Mr Rithy stressed that this project achieved success because it focused on all these factors and creating a development with an ecosystem of features for residents. So far, The Mekong Royal has sold 95 percent of its units.
Commenting on growing plot land transaction trends outside of Phnom Penh, Mr Rithy said: “Some plot land development is not in accordance with Phnom Penh’s Master Plan. For example, some locations are for industrial purposes but people use those areas to develop residential projects.”
Mr Rithy explained that in this case the developers are not looking for a sustainable home investment. This is due to the reason that residents will not live a comfortable life in the area due to more factory buildings that make a lot of noise, which ultimately affects residents’ health. “The worst thing is that there will be no hospitals or schools in those areas since it is for industrial, not residential purposes,” Mr Rithy concluded.
Ultimately, for any developer or buyer looking to invest in Phnom Penh, looking at the Master Plan should be one of the first steps as it enables the individual to be fully informed about the future of their area of investment, and develop or buy a project which will suit lifestyle needs in the long term as well as allowing for a return on the investment.
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Vat Vin is an editor @ Realestate.com.kh