Condo supply sees modest increase

Sum Manet / Khmer Times No Comments Share:
A view of Phnom Penh’s expanding skyline. KT/Valinda Aim

The supply of condominiums in Phnom Penh rose moderately in the third quarter, adding 2,374 new units to the market, CBRE Cambodia said in its latest report.

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The third quarter of the year saw relatively limited new additions to the total condominium supply with the completion of just two significant projects –Skylar Meridian in Chamkarmon district and Apenines Condominium in Toul Kork.

Total supply within the condo market increased by 1.8 percent quarter-on-quarter, bringing the total number of available units to 12,048.

A little over 80 percent of this new supply was graded as high-end and is found in Chamkarmon district, which lived up to its reputation as a hub for high-rise property. Mid-range additions were mostly in the up-and-coming Toul Kork district.

“Most notably, the third quarter saw six new condo project launches, most of which are located in secondary districts.

“The newly launched projects add a further 2,374 units to the supply pipeline, and marked a 5.2 percent increase in new launches quarter-on-quarter, signaling renewed confidence from developers,” the report said.

TK Star International, which comprises 910 units, was the largest of the projects launched, amounting to 38.3 percent of total additions to the pipeline in the third quarter.

Sale prices remained stable across the condo segment, with all sectors experiencing modest positive uplifts of less than 1 percent when compared to the second quarter.

Prices of high-end properties increased by 0.5 percent, mid-range by 0.4 percent and affordable by 0.2 percent.

The performance of sale prices varies when compared to the same quarter last year, with affordable projects experiencing a positive adjustment of 5 percent, and the high-end segment increasing by just 1.8 percent. Prices in the mid-range segment fell by 2 percent, primarily due to a large increase in supply.

James Hodge, associate director of CBRE Cambodia, told Khmer Times that rental levels in the condominium sector saw a drop during the second quarter, but have stabilised during the third quarter, with some sectors even seeing increases.

The fact that only two condominium projects were completed in the third quarter, adding just 218 units to the supply, has helped keep rental prices steadier, he explained.

“Six projects containing 2,374 units were launched during the third quarter. This is the most projects we’ve seen launched in a quarter for around two years,” he said.

“The new supply has largely been focused on affordable projects in secondary districts.”

He said that market indicators, particularly pricing, indicate that mid-range is the sector that is most likely to be in over-supply, with prices that have shrunk by 2 percent compared to the same period last year. Affordable and high-end sectors have both seen price increases, he said.

During the first nine months of the year, the Ministry of Land Management, Urban Planning and Construction approved construction permits for 2,541 projects, which are worth a combined $4.82 billion.

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