New CVEA Chairman Lays Out Ambitious Strategy
After being appointed as head of the Cambodia Valuers and Estate Agents Association (CVEA)’s 4th mandate following the resignation of former president Sok Bun, Kim Heang has outlined four main goals to enhance Cambodia’s property industry and promote the CVEA.
With 14 months of his mandate remaining, Kim, the founder and CEO of Khmer Real Estate Co., Ltd, aims to; enhance the CVEA governance; set up a real estate school; eliminate chaotic commission rates; remove the barriers between large and small real estate firms and also between developers and real estate agencies; and host a successful ASEAN Valuers Association (AVA) Summit in Cambodia in 2016.
Enhancing governance
According to Kim, he will be restructuring the management structure of the eight-year old association to equally share its benefits among all members. Three vice-presidents will be recruited from among members via a transparent selection process to independently handle appraisals, development, leasing, and transaction services.
The vice-chairmen for appraisals and development will respectively lead relevant members to seek business opportunities and partnerships with financial institutions and developers.
The third vice-chairman for leasing and transaction will lead relevant members in negotiating for standardised commission rates. Current commission rates are anarchically negotiated between agents and sellers, so the aim is to achieve at least a one month fee commission for any leasing deal and at least 3 percent for transaction deals.
Where previously the CVEA president held the top position in the organisation, the 4th mandate will see the introduction of a board committee with seven permanent members plus two independent members who are experts in economics or law to provide oversight.
Breaking down barriers
“If a single real estate firm wants to do business orientation with all financial institutions and big developers, it is hard to meet them, but if we request it together under the CVEA with over 60 members, those banks and developers may not reject our request,” he said, adding that, “I want to help small real estate offices to gain the same opportunities as the big players and be able to meet executives of those financial institutions and developers.”
Setting up a realty academy
Helping establish a real estate school to improve local agents’ professionalism against in the context of regional integration is one of Kim Heang’s major commitments. Though not operated by CVEA, the association will assist any private individual, member firm, local or international institution that has the required capacity to produce globally-recognised agents.
“Now there are applications from institutions in Thailand, Singapore and the UK,” he said. “We greatly welcome them, but I want to select the best one with internationally recognised standards that can produce qualified agents to compete against inbound foreign agents. We need to check their history, school, curriculum, and lecturers’ backgrounds.”
Currently, Kim is also considering cooperating with Century 21 University and the Singapore Institute of Management (SIM). “I don’t need guest speakers to train agents, a school providing training via the internet and lecturers without qualifications. I need professional lecturers with official graduation certificates in real estate at university level,” he explained.
Kim confirmed that the CVEA won’t make any profit from the school but will provide necessary support such as by offering floors for practicum at its member offices. Anyone interested in joining the real estate sector either whether CVEA members or not, will be eligible to register. The tuition fees will be set by the school itself.
With over 10 years experience Kim Heang welcomes the intention to establish real estate subjects into Cambodia’s higher education curriculums, but has concerns about the lecturers’ qualifications. “So far, I can’t find any Cambodian that has a bachelor degree in property appraisal yet, so who can teach the students?”
Chairing the 19th ASEAN Valuers Association Congress
Cambodia will host the 19th ASEAN Valuers Association (AVA) Congress in Phnom Penh in June 2016, where Kim Heang has been appointed the summit chairman. He is confident the CVEA will successfully organise this prestigious regional meeting and expects about 500 international real estate and construction investors to join the event.
Looking to the future
Kim remains satisfied with the current levels of prosperity in the real estate market despite concerns over current supply slightly exceeding demand. However, he encourages existing and new developers to continue developing properties to the high standards their target markets require.
Looking to the future, Kim admits the up-down property cycle of property could see a crisis but that solutions can be built in. “We can’t stop developers building properties. If they can develop and sell, let them do it. If people can buy, let them buy. I can only congratulate them, not discourage them.”
“If we can keep 7 percent of annual economic growth and ensure the ongoing political stability together with a better legal environment, I don’t think we will face a crisis in the next three to five years. Cambodia also never faces serious natural disasters like other nations.”
As regional integration looms, Kim worries that local real estate offices that are small and weak won’t be able to survive against inbound foreign firms. His idea is to unify Cambodian firms to ensure all of them can survive in tougher market conditions.
To ensure the industry’s stability, he also wants the relevant public agencies to not allow developers to collateralise project land title deeds at banks to get loans.
Kim’s advice to developers, especially novice ones, is to ensure enough budget to complete the project without relying on customers’ deposits, to have a extensive, clear network of targeted buyers in hand and to publish accurate sales statistics. In addition, he also alerts developers to not request bank loans over 20 percent of the property value to avoid facing potential crisis during an economic recession.
Finally, Kim advises buyers to purchase properties from developers with a strong background and where the hard title is issued.
Bringing his wealth of experience and ambitious strategies to bring unity, education and equity to its members and the sector, Kim Heang intends the future to be bright for the CVEA.
CVEA borey and apartment team members visit Camko City, Phnom Penh
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