Third Makro outlet planned for capital’s Chroy Changvar

Makro (Cambodia) Co Ltd is set to invest $12.7 million in its third Cambodian outlet, this time in northeast Phnom Penh’s Chroy Changvar district, an area dotted with high-end residential developments, as shopping behaviours continue to evolve in tandem with economic growth.

The Cambodian Investment Board, under the Council for the Development of Cambodia (CDC), has agreed to issue a final registration certificate for the project – expected to provide 161 jobs – located in Bak Kheng Leu village in Chroy Changvar’s northernmost commune of Bak Kheng, the CDC said last week.

Makro entered the Cambodian market in 2017, and currently operates two stores – in western Phnom Penh’s Sen Sok commune and Siem Reap town.

Global Real Estate Association president Sam Soknoeun said that the real estate market in Chroy Changvar has grown rapidly over the past five years, with many housing developments springing up, especially those in the high-end segment.

Soknoeun noted that the district’s population is growing considerably, in a trend he ascribed to major projects such as the Morodok Techo National Sports Complex and duo of emerging satellite cities – OCIC and Ly Yong Phat – as well as its increasingly interconnected infrastructure network and rising number of schools, entertainment venues and government facilities.

He predicted that the new Makro store would be a “quick success”, reasoning that Chroy Changvar offers “all manner” of opportunities, given its rather dense population and its primary thoroughfare, National Road 6, which links the capital to Mok Kampoul district in Kandal province and beyond.

“When opened, the Makro [Cambodia] Co Ltd commercial centre will not only make life easier for locals, but also make the real estate market there more prosperous,” Soknoeun claimed.

Thai discount wholesaler Siam Makro Pcl plans to spend 11 billion baht ($317 million) this year to expand its operations, and open two new Makro stores in Cambodia, 30 in Thailand and three in India, hoping to tap into soaring demand, group CEO Suchada Ithijarukul said, according to a Bangkok Post article on April 1.

The plan would bring the total number of Makro stores at 184 by end-2022, of which 172 or 93.5 per cent will be located in Thailand, the Thai daily said, without mentioning a possible location for Cambodia’s fourth outlet.

On the Stock Exchange of Thailand, Siam Makro’s share fell 1.50 baht (4.33 US cents) or 4.05 per cent to close at 35.50 baht ($1.03) on May 11 – down 18.86 per cent from this year’s high of 43.75 baht seen on February 21 – for a market capitalisation of 378.25 billion baht, with 20.84 million shares traded.

Plans for Cambodia’s third Makro store come as the occupancy rate of retail space in Phnom Penh dropped to 66.6 per cent in the first quarter of this year, down from 67 per cent in October-December 2021, according to a report by real estate company CBRE Cambodia.

The report compared the first-quarter occupancy rate with the figures of the corresponding quarters in 2021 and 2020, respectively at 74.9 per cent and 89.9 per cent.

This trend comes even as pandemic restrictions were phased out and the Kingdom battled to emerge from the shadow of Covid-19, and as the total retail space in the capital is expected to increase substantially this year.

The report lists the average monthly quoting rental prices during the period at $27 for “prime shopping mall” units (unchanged from the fourth quarter of 2021), $22 for “prime high street” units (down 6.8 per cent), $21 for “prime retail podium” units (up 5.6 per cent), and $21 for “community mall” units (down 1.6 per cent).

CBRE Cambodia predicts that around 300,000sqm of retail space will be added to the Phnom Penh market this year, pushing the total past 700,000sqm.

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