Plans to break ground in 2023 on a bridge linking Arey Ksat commune across the Mekong River to northeastern Phnom Penh have not significantly made the real estate market in the Kandal provincial locality more attractive for investors, despite initial optimism, according to industry analysts.
But many believe that transactions could gain real momentum, and prices may skyrocket once construction has commenced.
Minister of Public Works and Transport Sun Chanthol on January 10 said studies associated with the construction of the Cambodia-South Korea Friendship Bridge, also being called the Svay Chrum Bridge, were nearly complete. He confirmed that construction could begin next year.
The minister made the remarks during an inspection of works on the 38-road renovation project in Siem Reap province.
Chanthol said the two main proposals for project are: a single bridge from the capital’s Chroy Changvar peninsula to the Phnom Penh Water Supply Authority’s Svay Chrum pumping station; or a bridge from near the Phsar Chas Market (Old Market) to Chroy Changvar, and another from the peninsula to the Arey Ksat area.
Located in Kandal’s Khsach Kandal district, Svay Chrum is a village in a commune of the same name, just north of Arey Ksat in Lvea Em district.
The ministry is weighing the potential impact and costs involved in either scenario, as well as the forms of the bridge, he said, mentioning as a potential model the cable-stayed Tsubasa Bridge (Neak Loeung Bridge) that connects Kandal province across the Mekong River east to Prey Veng along National Road 1, the minister said.
When the studies are completed, the bidding process for the construction of the bridge will start, he noted.
Global Real Estate Association president Sam Soknoeun told The Post on January 12 that although property prices in Arey Ksat had rocketed to record highs years ago, rates have remained relatively stable in the last two or three years.
But land prices will once again witness sharp rises when bridge construction gets off the ground, he forecast.
“Real estate in Arey Ksat is like an unprocessed diamond – when the bridge connects it from Phnom Penh, it’ll turn the area into a refined specimen much like Chroy Changvar is now, with similar land prices to boot,” he said.
According to Soknoeun, prime land in Arey Ksat – along the riverside – costs some $1,000 per sqm on average, residential plots go for around $100-$300 and large development plots tend to fall from $180-$250.
Noun Rithy, president and CEO of real estate investment agency Khmer Foundation Appraisals Co Ltd, surmised that Phnom Penh’s third ring road which is planned to pass through Arey Ksat, coupled with the new bridge, would shake up the market and transform the locality into an eminent borough that is close to the capital.
Infrastructure construction is highly intertwined with the state of the real estate market, he underlined.
“The government’s ongoing efforts to build infrastructure are creating new opportunities, and are a driving force for Cambodia’s real estate market and economy to swiftly recover to pre-Covid-19 levels,” he said.
Going forward into 2022, Rithy predicts that the Cambodian real estate market will improve over last year, despite the lingering global economic threats posed by Covid.
Prime Minister Hun Sen has also commented on the possibility of Arey Ksat turning into a sort of satellite city down the road.