The European Chamber of Commerce has hosted their flagship Tall Buildings Forum, Cambodia Investment Review was the official media partner for the event which hosted Cambodia’s leading real-estate and tall building experts.
Phnom Penh and Sihanoukville have seen a rapid increase in the number of high-rise buildings since 2005 with the current highest building ‘The Peak’ at 55 storeys and the under construction Mesong Tower planned for 71 storyes.
The common theme of the forum focused on ensuring future tall building in Camboda were sustainable in their development, maintenance as well as the overall impact on the environment and its surroundings.
H.E. Dr. Pen Sophal, the secretary of state at the Ministry of Land Management, Urban Planning and Construction (MLUPC), opened the forum and asked for developers to keep Khmer culture, tradition, and architectural styles in mind when designing new buildings.
“I would like to call on real estate developers, builders, project designers, as well as construction managers to pay close attention to the spirit of national culture in their architectural works. They should prioritize sustainability and green development in compliance with regulations on urban planning, construction, and the environment,” he said.
“They should take responsibility for the development and preservation of national identity with Khmer culture and civilization, and the noble tradition of our nation,” he added.
Director-General of the ministry’s General Department of Construction, H.E. Dr. Chhann Sorphal, provided an overview of the 2019 Law on Construction and recent relevant sub-decrees in the sector.
Tall buildings are, currently defined as 12 storeys or more by the MLUPC and 18 storeys or more by commercial real estate firm CBRE have a short history in the Kingdom, with 32-storey Canadia Tower being the first to be built in 2005.
Uncertain economic environment
While optimism in the sector rebounded slightly after COVID-19, Lawrence Lennon, the managing director at CBRE, warned stakeholders to take a cautious approach against the backdrop of rising inflation, the Russia-Ukraine war and geopolitical issues suppressing the global economy.
He said the economy could be in the “eye of the storm” with a threatening global recession on the horizon and noted that material costs for developers had risen by approximately 20 to 30 percent since the start of COVID-19.
Lennon added that a shift towards catering to the domestic market would be a wise choice for stakeholders in the industry.
“Phnom Penh has transformed into an almost unrecognizable city, raising questions about sustainability, construction quality, health and safety, and the economic viability of tall buildings in the face of oversupply,” he said.
“We as real estate construction and urban development professionals have a great honor to shape the future of the city and in turn the lives of its habitants. We must work together to make Phnom Penh a thriving, healthy, and interesting place to call home. The private and public sectors must collaborate to encourage the diversification of the Cambodian economy, increase sustainability, and create a more livable, unique urban environment,” he added.
According to CBRE, Phnom Penh office occupancy is currently 66.9% with prime office rents at $22.3 per square meter and average high-end condo sale price at $2,671 per square meter.
Sustainability after rapid development
Saibal Das Chowdhury, the co-founder and CEO of Urbanetic who was visiting from Singapore, said in his speech that utilizing big data and digital master planning could help Phnom Penh develop in a more sustainable manner.
“The government’s role is very important to building a sustainable future,” he said. Among the key priorities he added, were protecting life, supporting green energy, keeping cities cool, and monitoring and preserving the natural environment.
Managing Director of BEE Incorporations Dr. Susanne Bodach outlined different environmental certifications available and advocated for the implementation of new tech to monitor and control indoor environments.
For example, she said 90 percent of a building’s operating costs are accounted for by staff, but the often poor air quality found in indoor environments can greatly reduce productivity. Meanwhile, two-thirds of a typical tall building’s operation costs are consumed by cooling systems.
Vannak Seng, the general secretary at Phnom Penh Capital Hall, said he was working with Bodach to help map a more sustainable Phnom Penh.
He added that the city incorporated its first master plan in 1932, and was designed with the help of French nationals for a population of 300,000, since that time, the city’s population as grown immensely and needs have changed.
Property management for tall buildings
To close the forum, the Managing Director at The Mall Company Simon Griffiths, moderated a panel on the challenges and risks of property management for tall buildings.
The panel agreed that more regulation was needed regarding service charges to uphold proper maintenance in tall buildings.
According to the panel service charges were not commonly paid at large buildings and occupants don’t want to pay for top property management, causing building maintenance to drop and the value of buildings to go down.
Property Management consultant Jovany Antonio commented as occupants skimp on property management costs and push maintenance projects down the road in favor of quick profits, the values of these properties drop.
Ratanak Siv, the senior manager of property management at Urbanland Asia Investment added: “If your building is Grade A, but your management service is a C or C-, the customer service isn’t great, the common areas and common facilities aren’t well maintained, who wants to live in the building? That’s why property management plays a very important role.”