Bridge project equals prospects for Phnom Penh satellite city
Growth in the property sector has been slow in Kandal province’s Ta Khmau City, 11 kilometres south of Phnom Penh, but that, industry sources say, is likely to change due to improvements to National Road 1 and the fact that the Ta Khmau Bridge is now completed.
Van Chanthon, managing director of Town City Company, says Ta Khmau city has developed slowly, but that is expected to change because the Ta Khmau Bridge connects to National Road 1, making it possible to bypass Phnom Penh when travelling to Takeo, Kampot, and Sihanoukville.
“I think that if Ta Khmau becomes a transit point, it will become a place where people park and take a rest from their travels, and that will lead to an increase in travel amenities such as restaurants and hotels,” he says. “Samdech Decho Boulevard and the satellite city (AZ CITY) development in the Choeung Ek area of Ta Khmau take part to push the development.”
Kuy Vat, president and CEO of Vtrust Group, notes that despite substantial increases in property transactions and prices in Phnom Penh, immovable property prices in Ta Khmau have seen increases of just 5 to 10 per cent.
Meanwhile, Kim Heang, president of Khmer Real Estate says land prices in Ta Khmau had seen some movement in the past as a result of the plan to build the Ta Khmau Bridge, which offered better trade connections with southern Cambodia. But he says that South Korean, Japanese and American foreign investment had let to little in the concrete developments in the wake of the global financial crisis of 2007-8.
He adds that this had led to a flattening out of property prices in Ta Khmau City, and even an exodus away from the city into Phnom Penh.
“Even though Ta Khmau City is close to Phnom Penh, people tend to flow into the city because few want to live in the provinces,” he says.
This has had a knock-on effect, with prices for rice fields stagnating at around $7,000 to $10,000 per hectare, but a shortage of buyers for anyone who wanted to sell.
According to Heang, prices for condominiums have similarly been affected, with an initial surge in prices after the announcement of plans to build the Ta Khmau Bridge, followed by a correction in prices after its completion.
Prices for flats and condominiums along the main road ranged from around $60,000 to $70,000 but jumped to an approximate average of $150,000 when the bridge was announced, he says. Today, prices range from an average $120,000 to $130,000, and it is a buyer’s market.
Nevertheless, Van Vat, deputy chief of the Kandal Provincial Department of the Ministry of Land Management, Urban Planning and Construction, says that a plan for Ta Khmau City would be complete within the next three years. According to Vat, the plan would be helpful in terms of managing development, and he adds that he was confident it would add value over the longer term.
“Considered planning and management will increase investor confidence,” he says, adding that proximity to Phnom Penh was another factor that would draw investors, particular as commuting into the city became more feasible.