At much as $1 billion in tourism investment is going into Cambodia’s 443 kilometer coast, filling a hotel and resort gap between Thailand and Vietnam.
Etienne Chenevier, a veteran French developer in Cambodia, is joining with Alila Hotels and Resorts to build a five-star hotel and villa resort on Koh Russey Island, off the coast near Sihanoukville. The first phase of this $70 million project opens this December.
Chenevier, CEO of Citystar, talks to Khmer Times about the opportunities – and pitfalls – of Cambodia’s Coast.
KT: What is the significance of your island project?
Chenevier: This is the first time in Cambodia you will have a five-star resort of international brand.
KT: What about Song Saa Private Island?
Chenevier: To be fair with Song Saa, they were the pioneers. They are a boutique with 27 luxury rooms, a niche.
This is with Alila. So this is the big game coming. It is a signal to the hospitality community that big players have selected the country are relying on it, and have accepted to take risks. That is important for Cambodia.
KT: What is the potential for high-end tourism on the Coast?
Chenevier: Siem Reap gets 2.5 million tourists year. Half of these people go to the beach. But, until now, none of them go to the beach in Cambodia. You have 10 international brand 5-star hotels in Siem Reap, plus local 5-star hotels – and these people stay only two and a half nights.
People who go to the beach stay five, six or seven nights. Angkor is one visit in your lifetime. The beach is not. If you like it, you come back. So the hospitality potential for Sihanoukville, however you calculate it by arithmetic, is two to three times that of Siem Reap.
KT: So why is the Coast slow in taking off?
Chenevier: The problem is connectivity. In 2009, the Sihanoukville airport was finished and certified. The domestic carrier [Cambodia Air Angkor, with Vietnamese investment] opened in July 2009. But Vietnam Airlines did not want to open the Siem Reap-Sihanoukville route.
KT: Market analysts believe Vietnam Airlines favored flights from Siem Reap to Phu Quoc, Vietnam’s resort island. What is the current state of air service to Sihanoukville?
Chenevier: Finally, due to pressure of Cambodia’s government, they opened. In 2012, they started three times a week. Last October, they went daily. This winter they put an Airbus on the flight from Siem Reap to Sihanoukville. So that proves that passengers are coming.
KT: So while Angkor has switched from turboprops to jets, another airline is planning commercial flights from Bangkok to Sihanoukville, and charter flights from China to Sihanoukville. How would that change things?
Chenevier: This is very good news. Today we are saying Sihanoukville is an international airport, but there are no international flights, not even charter flights. Technically, there is no problem. 737s can land there. There is no reason why you cannot have Bangkok–Sihanoukville or Singapore– Sihanoukville.
KT: So direct international flights will be the game changer for the Coast?
Chenevier: As soon as you have connectivity through Bangkok or Kuala Lumpur, it changes the picture. The first international flights are going to change the picture, as they did in Siem Reap. When I visited Siem Reap for the first time in 2001, the flight from Bangkok had opened just six months before. Then you had only 50,000 tourists a year. Now you have 2.5 million.
KT: How did air service influence your resort investment plans?
Chenevier: Everything started with the airport. The flights started in December 2011. In 2012, we could show investors that flights had started. We raised $20 million for the first stage. We started the international architectural competition in January 2013. It was won by a Singaporean firm. We got the permit in June 2014 and started construction in July 2014.
KT: You say airport to island in half an hour. How does that work?”
Chenevier: Ten minutes by car from the airport to our private jetty, then 10 minutes by speed boat to Koh Russey. We are starting construction of the jetty in coming weeks.
KT: You have pre-sold 10 of 143 planned villas. Why are people buying?
Chenevier: To attract people to a new country you have to be competitive.. [He points to a maquette of a 2-bedroom villa] This is priced at $770,000. Such a product in Phuket would probably be double. We offer more land, more privacy. They are very private. And, looking west, you can see the sunset all year long.
KT: The model shows a lot of villas. Is that so buyers can visualize their future houses, or is the development dense?
Chenevier: The overall footprint is only 15 percent. So it will be a very green place… We have a Singapore-based Thai landscape architect overseeing the selective clearing and planting. Between villas, we will keep as much as possible existing vegetation. The advantage of Sihanoukville is that it receives 3,000 mm of water every year.
KT: Will the August-September rainy season be the dead season?
Chenevier: The rainy season is inconvenient, but not only for us. Kep has a rainy season. Koh Samui has a rainy season. Malaysia has a rainy season. In Angkor Wat, the rainy season is a hardship. You are not going to swim in the temples. Some hotels close for maintenance. In a beach destination, if you want to go for a cheap price, to Phuket for example, you go and get good deals. So you still fill your hotels.
KT: You say 250 people will work at the core project, the 150-room Alila luxury hotel. On a relatively small island, where will all these workers live?
Chenevier: We did not want to make a village on the island. It raises a lot of environmental concerns. The paradox of green development is that you cannot transport into the green nest all the constraints of building a town – sewage, police post, pagoda and school – as in the end you are taking up too much space. Our advantage is that we have a real village on the mainland.
KT: So workers will commute by boat, 15 minutes from Sihanoukville, or 10 minutes from your new jetty, where there is an existing village of 8,000 people, near Ream Naval Base. What else does your crystal ball tell you about the future of Camodia’s Coast?
Chenevier: Nobody wants to go to Sihanoukville by car any more. Unless you leave at 5 in the morning, it is really long. For the airlines, a Phnom Penh–Sihanoukville shuttle will be a gold mine.