Cambodia's office rental prices decline as supply exceeds demand
July 16, 2010
Supply of office space continues to outstrip demand in Phnom Penh, putting pressure on already squeezed rental prices, withrates down 25 percent in the second quarter, compared to the same period last year, local media reported on Friday.
Keuk Narin, secretary of the National Valuers Association of Cambodia and general manager of Bonna Realty Group, was quoted by the Phnom Penh Post as saying that increasing office space for rent in Phnom Penh was forcing a cut in rental prices.
A quarter-on-quarter comparison of rental rates showed that 2010 second quarter prices fell 2 percent from the first three months of the year, when rates were already 10 percent lower than the 2009's fourth quarter.
A year-on-year comparison shows office rent is between 20 percent and 25 percent lower than in the second quarter of 2009.
"This year the supply of office space for rent has increased 15 percent - much more than the demand - and I think that has pushed prices still lower this year," he was quoted as saying.
The valuers association estimated that monthly rent for A-grade office space ranged between 20 U.S. dollars to 30 U.S. dollars per square meter, down from first quarter rates of 25 U.S. dollars to 35 U.S. dollars. The average occupancy rate for the first six months of this year was around 50 to 60 percent. Rental rates in B- grade offices now ranges from 8 to 12 U.S. dollars per square meter, down from 10 to 15 U.S. dollars per square, with an average occupancy of about 66 percent.