On July 31, 2024, AmCham's Real Estate and Legal Committee co-hosted a "Tourism, Hospitality & Real Estate Review: Market and Legal Updates" event at the ATOM, Vattanac Capital in Phnom Penh.
The event brought together industry experts to provide insights into the current trends and legal developments shaping Cambodia's hospitality and real estate landscapes.
The event featured remarks from Ruwan Hulugalle, Senior Consultant at HBS Law Asia; Sothea Hy, president of the Cambodia Hotel Association; Paul Volodarsky, Partner and Head of Regional Real Estate & Hospitality at DFDL Thailand and Vietnam; Tom O’Sullivan, CEO of Realestate.com.kh; as well as other professionals from the tourism, real estate and legal sectors.
How Has Cambodia’s Tourism Sector Performed In The First Half 2024?
Sothea Hy highlighted that in 2023, Cambodia attained 81 per cent of its international arrivals compared to pre-pandemic levels, with flight arrivals only at 42 per cent, while arrivals recorded over land the borders had reached two-thirds of the previous levels.
Additionally, he shared that ticket sales for Angkor Wat in the first half of 2024 represented only 36 per cent of 2019 sales.
“It’s encouraging to note that most nationalities have returned to their pre-pandemic travel patterns, with the notable exception of China,” shared Sothea. He maintained that there is a glimpse of hope in the increase of Indian tourists due to the direct flights between the two countries having launched in 2024.
He also noted that there have been new hotel openings in Cambodia (mostly in the capital), despite the pandemic, and these included well known brands such as the Hyatt Regency, Novotel, Tribe, Ibis Budget, Fairfield, Citadines and more.
Overview Of Cambodia’s Condominium Market
Discussing the Kingdom’s growing condominium market, Tom O'Sullivan recalled that it was only in 2009 that it became legal for foreigners to own certain types of real estate properties in Cambodia, resulting in the completion of the first condominiums in Phnom Penh in the years following – including Rose Condo, De Castle Royal, and Olympia – between 2013-2014.
Fifty-five condominiums were launched or under construction in Cambodia between 2013-2015, with the market continuing to grow until 2020, and even during the COVID-19 pandemic.
O’Sullivan explained: “We saw the growth of property prices from 2013, all the way up to 2019, or the start of 2020. Filling the demand of both the domestic market and international investors, who see Cambodia as a great opportunity for many reasons; US dollar-based investment, a relatively under-urbanised location, and a demand for more housing from renters and buyers.”
Reflecting on the current market in 2024, O’Sullivan acknowledged that new property launches have definitely slowed down and corrections have happened in the market, meaning prices are returning to those seen back in 2013-14.
While describing Cambodia's real estate market as ‘stuck’, he also highlighted that his company, Realestate.com.kh, has been performing well over the past 24 months, recording around 1,000 sales with 25 per cent sold to local Cambodian buyers.
What Are The Latest Legal Updates In Cambodia's Real Estate Sector?
A presentation on the latest legal updates in Cambodia's tourism and real estate sectors was presented by Davy Kong, Partner at DFDL Cambodia.
Key legal updates for 2024 include:
- Prakas 50 (July 19, 2024) on the procedures and formalities for registration of private units of co-owned buildings constructed before December 19, 1997.
- Special Program to Promote Investment in Preah Sihanouk Province (2024).
- Article 17 of Prakas No. 047: Land parcel development.
- Articles 9 and 20 of Prakas No. 047: Housing/co-owned building development.
- Prakas No. 047: Residential Development.
- Prakas No. 047, which replaced Prakas No. 089 dated January 20, 2020, on the management of Real Estate Development Business.
Watch a snippet of Davy Kong's presentation on Prakas 050:
More information about each Prakas can be found on the DFDL Cambodia website.
Cambodia Needs More Tourism Promotion
On the discussion on Cambodia's tourism sector, Sarah Moya, General Manager of the Courtyard by Marriott, said that while Cambodia will not be able to rely on upcoming major events, such as hosting the ASEAN Summit or the SEA Games (which Cambodia did in 2022 and 2023 respectively) to help boost tourism in the near future, the country is still forecast to receive 7 million visitors in 2025 (which is still below pre-COVID levels).
With a new airport set to open in Phnom Penh and hopefully improve connectivity, she said “this is going to make a difference.”
However, Moya added that there is still a need for a more concerted effort to promote the nation as a must-see destination, particularly highlighting Phnom Penh, Siem Reap, and Cambodia’s coastal areas as having potential.