Commercial Real Estate News
Phnom Penh's Commercial Office, Retail Markets Face Slowdowns in 2024
In the first half of 2024, Phnom Penh's commercial markets have faced a downturn, as reported by global property consultant CBRE. Both the office and retail sectors experienced declines in rent and occupancy rates in H1 of 2024.
Prime office rents fell to $27.0 per square meter, with an occupancy rate of 61.8%, while prime retail rents decreased to $22.1 per square meter, with a 58.7% occupancy rate. The residential market also showed signs of slowing, with only two new landed property projects and three condominium projects launched during this period.
Despite these challenges, Phnom Penh continues to offer strong investment opportunities. Condominium prices in the Central Business District are competitively priced at $2,500 per square meter, yielding an attractive rental return of 5.3%. The city's investment appeal is further enhanced by its affordable pricing and the provision for freehold foreign ownership in co-owned buildings.
Additionally, the industrial sector is at the forefront of sustainability, with 36% of LEED certifications granted to industrial properties. Industrial land leases are available at $61.0 per square meter for a 50-year term, and ready-built factory rents are set at $3.0 per square meter.
