English 
ភាសាខ្មែរ 
Key takeaways:
- Rising of the industrial sector primarily leads to more locations
- The garment manufacturing industry makes up to 20% of the whole foreign investment
- Industrial property is expected to surge to 3,000,000 sqm by 2030
- The 3rd city ring road will soon be a top destination for the industrial sector as the completion draws near.
“Phnom Penh is developing in all aspects of the country. Most of the areas are residential and commercial sectors. Hence, new industrial projects and garment manufacturing are encouraged to shift to suburbs and other provinces, such as Kompong Speu. Since it’s close to Sihanoukville and Phnom Penh, it is convenient to transfer goods.”
The development of the manufacturing industry plays a key role in the economic development of the country. It essentially contributed to the high demand for the industrial sector supply in Cambodia. In fact, suburbs and other provinces located near Phnom Penh saw huge potential as manufacturing factories were being encouraged to shift to areas outside of Phnom Penh.
Industrial supply stands as one of the key segments in the real estate sector, primarily focused on manufacturing, storage facilities, warehouses, garment manufacturing, food processing facilities, electronic manufacturing, and other essential products ー to answer to the demand of both locally and internationally.
As reported by The Ministry of Economy and Finance, the garment manufacturing industry collected a whopping $7 billion of investment. The sector represents 17% of the entire foreign direct investments to Cambodia during the last five years as of 2021.
About 2 to 3 million Cambodian people derived benefits from this industry, despite the growth of other industries in the country. Additionally, the garment manufacturing industry makes up roughly 70% of the total export during these past five years. Rather than relying on the garment export, the government is diversifying its export by expanding into vehicles compartment and electronic components – to name a few.
During 11 months of 2021, Cambodia exported (excluded gold), around $15 billion to the international market, a 22 percent hike compared to the same period of 2020. This significant growth is a result of textile goods and vehicles.
According to a report from CBRE Cambodia, prices for outer suburbs of Phnom Penh annually increase to an average of 20% in comparison to the inner suburbs which is 10%. This growth is a result of the improvement of infrastructure investment, the city master plan, and real estate investment, along with other promising developments.
Phnom Penh Capital Administration stated that the main purpose of urging the manufacturing industry to choose suburbs location is to cut down on the number of huge trucks travelling into the city which disrupted the traffic.
The 3rd ring road is on the way to becoming a vital location for manufacturing companies and enterprises, as it draws near completion. It is estimated to be finished by 2023, with a total length of 53km stretching between Phnom Penh and province-connected national highway number 4 and national road number 1.
Vtrust Appraisal, a real estate evaluation company divided industrial real estate supply into 3 essential categories, such as food processing, beverage, and packaging.
This report revealed that as of 2018, all the manufacturing factories have approximately occupied 1,600,000 sqm of land. It is expected to rise to 3,000,0000 sqm by 2030.
Among all districts, Posen Chey district, Meanchey district, and Dangko saw the largest industrial investment, compared to other districts in Phnom Penh.
“Phnom Penh is developing in all aspects of the country. Most of the areas are residential and commercial sectors. Hence, new industrial projects and garment manufacturing are encouraged to shift to suburbs and other provinces, such as Kompong Speu. Since it’s close to Sihanoukville and Phnom Penh, it is convenient to transfer goods.” said Mr. Chrek Soknim, president of Cambodia Valuer and Estate Agent Association.
English text by: Kem Sreynet
