An office rental index has shown Phnom Penh declining by over 10% year-on-year as recently completed grade A office buildings are offering rents as low as $16 per square meter a month, according to data by Knight Frank.
Ross Wheble, Country Head of Knight Frank Cambodia outlined that an oversupply of office buildings will continue over the next two years driving office rentals down.
“With the increasing number of office completions in Phnom Penh expected over the next 24 months, combined with the threat of new Covid variants weighing down on business sentiment, impacting on new entrants into the market, the office sector will remain tenant-favorable over the short to medium-term,” he said.
Cambodia Investment Review has previously reported on the ‘silver linings’ of Cambodia’s property and construction sector during COVID.
According to the company, rental quotes for Grade A office space in Phnom Penh have previously ranged between $28 – $40 Per Sqm a month. Grade B office space in Phnom Penh ranging between $18 Per Sqm – $29 Per Sqm – 43% of the overall supply being classed as Grade B.
Grade C Office space in Phnom Penh was ranging in price from $9 – $18 Per Sqm meter with 45% of the current supply. Most offices will also add a service charge ranging from USD $2 – $5 Per Sqm meter as well as charging value added tax on top.
Chip Mong celebrates ‘topping’ of mega building
Most recently Chip Mong announced it had completed the top 45th floor of its flagship Chip Mong Tower, an international mixed-use commercial building with an investment with an investment cost of $230 million, both land and construction.
The Chip Mong Tower building is 185 meters high and built on a land area of area of 14,042 square meters. The building has been designed to serve the key sectors contributing to the Cambodian economy, such as hospitality, office space for companies, enterprises, shopping malls and entertainment.
According to the Ministry of Land Management, Urban Planning and Construction data more than 4,000 new construction projects were approved in Cambodia with a registered capital of $5.33 billion – down 31% from 2022.