Cambodia’s warehouse rental market stabilises as COVID vaccines rollout

Vaccine rollouts around the world have led to increased investment projects and bilateral agreements 

According to industry experts, warehouse rental prices and demand in Cambodia remain stable year-on-year as COVID-19 vaccination campaigns in the country and around the world embed a positive outlook for the industry, reported The Phnom Penh Post.

Tang Hour, chief executive officer at Amatak Property Service Co Ltd, mentioned that the warehouse rental demand is strengthening, with the majority of instalments used for commodity storage and running businesses such as car dealerships and restaurants.  

“Even though the market continues to breeze through, some warehouse owners have taken to offering rent discounts for the first few years of occupancy,” said Hour.  

Hour attributed the market’s limited stock to its lower dependence on the number of overseas visitors travelling to Cambodia compared to the condominium and apartment sectors.  

She added that the average monthly rent for warehouse space in Phnom Penh is between USD2 to 5 per square metre, contingent on the location and condition of the facilities while leasing contracts are averaged at five years.  

On the other hand, Grace Rachny Fong, executive director of Century 21 Cambodia, presented that rental prices in the provinces continue to lose value, as market recovery overall has been slow but is predicted to pick up by the end of the year.  

According to Fong, warehouses over 1,000 square metres usually attract the highest demand.  

Fong added, “the market will be bustling from the fourth quarter of 2021, as COVID-19 vaccinations increase the number of investors from each country. Once investment grows, the demand for warehousing will shoot up as well.”  

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Hong Vanak, director of international economics at the Royal Academy of Cambodia, said that global COVID-19 vaccine rollouts have induced more investment projects approved by the Council for the Development of Cambodia.  

He also claimed vaccines to have stimulated work on bilateral agreements with trading partners and encouraged the construction of new infrastructure, which includes the Kingdom’s flagship deep seaport in Preah Sihanouk province. 

As a result, Cambodia’s demand for warehousing will be boosted even further, particularly from mid-2021 onwards.  

“All investment projects require warehousing, hence the market will enjoy a snowballing in demand, especially once the COVID-19 disease situation comes completely under control,” Vanak said.