Development projects cause land price buzz in Kampot

Development projects cause land price buzz in Kampot

Recent development projects in Kampot including an international seaport, a luxury resort on Bokor mountain and a restoration of the road linking the province to Phnom Penh have caused local land prices to soar.

According to a recent report from the Council for the Development of Cambodia, a US$15 million, 145-hectare Special Economic Zone (SEZ) is also being readied in Kampot, which will begin operation as soon as work begins on the US$4 million, 1,000 hectare seaport - hoped to be complete by 2013.

Another project thought to be pushing land prices up is the renovation of National Highway 3, the 148 km road link between Kampot and Phnom Penh, which will commence soon thanks to a US$41.5 million loan from South Korea.

"The construction of the road will get underway late this month or early next month," said Sout Yea, deputy governor of Kampot province.

But the most significant investment project to date is the US$1 billion project to develop a luxury resort atop Bokor mountain, which recently began construction.

The Sokha Hotel Group development has caused land prices along the road leading to Bokor to more than quadruple, added the deputy governor. "Previously, a square meter was between US$10 and US$15 and there were no buyers, but now it costs from US$50 to US$100," said Sout Yea. "Some landlords will not sell at these prices because they expect they will increase exponentially when the development project is complete."

In the last few years, land prices in Kampot have averaged around US$50 to US$80 per square meter, but recently due to the announcement of the development projects, it has risen to between US$80 and US$150, said Sung Bonna, CEO of the Bonna Realty Group, adding that, based on these factors, the prices will continue to rise.

However, Sout Yea added that although the number of investment projects in the province is growing, it is just a starting point because none are yet complete.

The prices are still very cheap compared to Phnom Penh, said Sung Bonna.

Land prices in the city increased by 30 percent in the first three months of 2008, Sung Bonna noted. "Commercial areas increased to between US$3,500 and US$4,000 per square meter, while residential areas now cost an average of US$2,300 to US$2,800," he said, adding that land prices are projected to increase between 50 and 70 percent this year, though the results of the general election may have some effect.

Nguon Sovan is a reporter for the Mekong Times

This article first appeared in The Mekong Times
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