Cambodia Investment Review

Leader Talks: Mauro Gasparotti on Phnom Penh’s Emerging Hotel & Real-Estate Trends and Future Prospects in 2024

Leader Talks: Mauro Gasparotti on Phnom Penh’s Emerging Hotel & Real-Estate Trends and Future Prospects in 2024

Cambodia Investment Review

Phnom Penh, the vibrant capital of Cambodia, is experiencing a dynamic transformation driven by a surge in tourism, investment, and urban development. Mauro Gasparotti – a leading expert in hospitality and real estate consulting, offers insights into the key trends shaping Phnom Penh’s hospitality future and the potential growth opportunities that lie ahead in 2024 and beyond.

Tourism and International Arrivals

Tourism remains a cornerstone of Phnom Penh’s economy. The city has seen significant fluctuations in international arrivals, with numbers peaking at 4.4 million in 2019. However, this figure dropped to 1.9 million in 2023, reflecting the broader impact of global travel disruptions. Despite these challenges, Phnom Penh’s recovery rate aligns closely with regional trends, showcasing its resilience and appeal as a tourist destination.

Read More: Accor Expands Footprint in Phnom Penh with Novotel Debut in BKK1 in 2024

Mauro emphasizes the city’s recovery, stating, “Phnom Penh’s ability to bounce back from global challenges underscores its growing attractiveness and resilience as a key destination in Southeast Asia.”

Hotel Supply, Mid-to-Luxury Segment. Source: Savills Hotels.

Hotel Supply and Development

Phnom Penh’s hotel industry has witnessed substantial growth, particularly in the upscale and luxury segments. The city now boasts a significant increase in hotel capacity, with a focus on quality  accommodation. The number of 4- and 5-star hotel rooms has expanded, mirroring the broader growth in Cambodia’s hospitality sector.

Mauro highlights the importance of this growth: “The expansion of luxury and upscale hotel offerings is crucial for attracting a diverse range of tourists, from leisure travelers to business visitors. This growth supports the city’s ambition to become a leading hospitality hub in the region.”

Positioning and Market Segmentation

The market positioning in Phnom Penh is becoming increasingly sophisticated, catering to a variety of segments. From ultra-luxury resorts to more affordable midscale accommodations, the city offers a diverse range of hospitality products. This includes the rise of branded residences and specialized retreats, such as wellness and yoga resorts.

Read More: IHG Hotels & Resorts’ Vignette Collection débuts in Phnom Penh

Mauro notes, “Diversification in hospitality offerings is essential for Phnom Penh to appeal to a broader audience and sustain long-term growth. This strategy not only enhances the city’s attractiveness but also ensures a balanced development approach.”

Hotel Supply by Segment. Source: Savills Hotels.

Challenges and Opportunities

Despite the progress, Phnom Penh faces several challenges. The city’s heavy reliance on tourism makes it susceptible to global economic shifts and external shocks. Additionally, there is a pressing need for improved infrastructure and sustainable development practices to support continued growth.

However, Mauro remains optimistic about the city’s future. He points to strategic investments and government initiatives focused on infrastructure enhancement and sustainable tourism as key solutions to these challenges. “Phnom Penh has the potential to overcome these challenges through targeted investments and a focus on sustainable growth. By doing so, it can solidify its position as a premier destination in Southeast Asia,” he asserts.

Brand Presence in Cambodia. Source: Savills Hotels.

Future Prospects

Looking ahead, the future of Phnom Penh appears promising. The city’s strategic location, coupled with ongoing investments in infrastructure and hospitality, positions it well to capitalize on the global tourism recovery. The focus on diversification and quality improvements in hospitality offerings will likely attract a broader range of tourists and investors.

Gasparotti concludes with an optimistic outlook: “Phnom Penh is at the threshold of a new era. With the right strategies and investments, it has the potential to become a major hub for tourism and investment in the region. The city’s resilience and strategic growth initiatives will be key to its success.”

Related Articles