- Office building grade B and C are in high demand, but the supplies remain low
- Average quoting rent for grad B and C is ranging from $12 to $22 per sqm
- The supply of office space estimated to jump to 1M sqm by the end of 2022
More businesses are turning to modern office buildings due to some factors – bigger office space, parking lots, and the convenience provided by building management.
This shift in demand is caused by more local businesses switching from renting flat house as their office building to looking for a modern and convenient office space, as stated by real estate experts.
This has reflected that demand for office buildings could become the second most local demanding segment in the real estate sector aside from residential property.
Ken Lo, CEO of Century 21 Imperial Realty, has said that the shift to modern building was due to factors like, similarity in price range, a more spacious area, better environment; and the safety offered by building management.
“Not only does the office buildings provide convenience, it also boosts the company’s reputation.’’ He added.
Office buildings are divided into grade A, B, and C. Grade B and C are targeting local buyers as these types offer reasonable prices.
Total office market is anticipated to rise to about 790 000 sqm of the net leasable area (NLA) by the end of 2021, an increase of around 147 000 sqm year on year. The figure is expected to rise further to over 1 million sqm of NLA by the end 2022.
The report highlighted that location, adequate parking and quality property management remain crucial differentiators required by landlords to defend against rising competition.
Up until 2021, the price of grade B is ranging from $19 to $22 per sqm per month, and grade C is priced from $12 to $14 per sqm, primarily depending on the locations. Office building grade A has an average price of $29 per sqm, making it the most expensive option.
President of Cambodian Valuers and Estate Agents Association, Chrek Soknim said, grade B and C office space are still under supply considering the demand keeps rising.
“Grade B and C offer great potential, yet the number of supplies is still low, and most segments are occupied. So, it’s a good sign for investors to consider and take the opportunity,” he said.