Are Condotels the Future of the Cambodia Real Estate Industry?

• 25 May 2018
• Local News
• 2371 Views

Real Estate in Phnom Penh City

Condotel is a new concept to Cambodia where a development is mixed between a condominium and a hotel. Unlike hotels, where a corporation owns the whole hotel, in condotels each unit is sold separately similar to a condo. Condotels have hotel-like amenities and services – unlike conventional condominiums.

Condotel units can be placed on a rental program with the management who can rent the units out for short or long-term rentals. The rent is split between management and the owner in the range of 40%-60% in favor of the owner, but can often be as high as 50%-50%.

Condotels are already popular in high-traffic tourist areas such as the USA and Dubai, but are becoming increasingly available in other areas as well.

According to Alexander Evengroen, Group CEO of UK Condo & Real Estate Co Ltd, Cambodia is definitely a potential market with a huge number of condominiums being build and sales lagging.

“There is a tremendous opportunity for Condotels in Cambodia due to the huge numbers of condos being built and available,” said Mr Evengroen.

“Do you sometimes spend days or a week in a luxury hotel and say, “I think I could live here?” Everything is pristine, a maid cleans up everyday, if something is not working you just call the front desk. If you get hungry you can pick up the phone and have just what you want delivered,” Mr. Evengroen explained.

“Then what if when you left that hotel and went back to your other home, other people stayed in that room and you received a portion of what they paid each night? Sweet deal, right?”

“That’s the general idea of a condo hotel or condotel investment. You buy a hotel suite like you would buy a regular condo, but since it’s part of a hotel the guest doesn’t know the difference when they get your suite that’s part of the rental pool. When you stay there you’re living in your own deeded unit—not a timeshare—but when you’re not going to be there you can be making revenue from it on a nightly basis. Someone else is taking care of everything behind the scenes and you just cash the checks.”

Mr. Evengroen is also seeing national and international opportunities as foreigners are able to buy and own condominiums so this way of investment opens new doors for unfinished or struggling condo projects.

“The main advantage of owning a condotel unit is its ability to generate passive income. Depending on its location and season of the year, it can potentially earn a lot of money,” he concluded.

–By Alexander Evengroen

Alexander Evengroen, Group CEO of UK Condo & Real Estate Co,. Ltd

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