Warehouse & Factory Leasing: Good or Bad Investment?

• 20 December 2021
• Local News
• 2217 Views

The business of building factories or warehouses for rent has been gaining in popularity in recent years. However, this type of business can be profitable or not depending on location and land size factors.

A local real estate expert and president of KW Cambodia Dr Kim Heang said that those who own only 1 to 2 hectares of land in the potential area, better not invest in a warehouse or factory leasing businesses. The business is profitable only when one owns more than 10 hectares of land at least.

“You will not make much profit from renting itself. Most people make a profit from this business by selling the remaining nearby land. For example, you own 10 to 20 hectares of land, and you build factories or warehouses on 1 to 2 hectares. You rent those out.,” said Dr Kim Heang.

“Years later, the remaining land of that you own will increase in price due to the business activities, For example, the land now is only US$20/sqm. However, after building a factory or warehouse, the price can be triple. Then, you will make a profit by selling the remaining land,” he added.

Dr Kim Heang also suggested that those owning land of less than 2 hectares of land should consider building affordable housing projects as the demand for this sector is growing significantly.

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