Construction Investment Growth Strong in 2013

• 31 December 2015
• Local News
• 1024 Views

Despite ongoing political turmoil since elections in the summer of 2013 and fears about possible economic fallout, investment in the Kingdom’s construction industry still surged 31 percent against the previous year.

Last year, the government approved 1,641 projects built on over 7.5 million square meters of building space. Combined, the total investment value was US$2.8 billion, a 31 percent jump over the 2012 amount. That year, the value was measured at US$2.1 billion even though 1,894 projects were built on 8.5 million square meters of land.

The figures come from a March report released by the Ministry of Land Management, Urban Planning and Construction, which looked at 2013 numbers as well as trends for 2014. The report also found that construction investment in Phnom Penh alone jumped significantly last year. Investments in the capital in 2013 reached US$1.5 billion, a 50 percent increase over 2012, which saw US$1 billion in investments over a 12-month period.

Of the overall construction budget in 2013, 30 percent was spent on labor while between 20 and 30 percent went to local material sourcing. Between 30 to 35 percent was spent on overseas material sourcing and about 10 to 15 percent went to national taxes.

The report said that the construction industry employed 100,000 workers per day last year, including 3,756 engineers and architects, 8,837 skilled workers, and 87,407 unskilled workers. The maximum salary was US$1,250 and the minimum US$150 per month. The number of people employed in the sector increased 16 percent over 2012.

At the end of 2013, Cambodia had 386 high-rise buildings. Of those, 310 have more than five floors, 67 have between 10 and 19 floors, three have from 20 to 28 floors and five of them tower between 30 to 39 stories. One building has over 40 floors.

The ministry licensed 212 construction-related companies last year, an increase of 11 percent over the year before. Among those, 151 are locally owned and 61 have foreign ownership.

Until the end of 2013, there were 1,641 units of co-private ownership buildings, such as condominiums, bought by foreigners. The average price of each unit was US$100,000, making the total spent by foreigners on housing units over US$164 million.

The ministry report also had information on the land registration campaign that kicked off in December 2012 to grant official titles to land owners in order to end ongoing land disputes. By the end of 2013, the ministry had entered into a database 50 percent of the land, equal to over 2.9 million plots, of the total 1.8 million hectares to be registered nationwide.

Last year, the ministry also earned over US$42 million from services offered to the public such as the fees for construction permits, property registrations, and construction business certificates. The ministry employed 2,987 officials last year.

Lao Tip Seiha, deputy general director of the ministry’s construction department, said: “In terms of growth percentages in 2013, construction-sector investment increased, but declined in some ways like the number of projects in comparison with 2012.”

Seiha said he expected continued investment growth this year because a large number of both local and foreign investors have applied for building permits since January this year.

There are several major projects set for completion this year. Aeon Mall, built by a Japanese firm, will be finished in June as will the Stueng Meanchey flyover. That project will wrap up ahead of its original schedule. The De Castle Royal condominium complex will open in May and the Vattanac Capital Tower will be inaugurated later this year.

Other large projects in the pipeline include Olympia City, Riviera condominiums, Toyoko Inn, Bali Scenery, The Bridge Condominiums, the Landmark Building and Booyoung Town.