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Revealed: South East Asia's 'rising star'

Jaimie Kanwar

A growing country in South East Asia could be on the verge of a real estate boom...

A decade ago, Cambodia's capital Phnom Penh didn't have a single traffic light; now high-rise condos and offices are springing up as investors rake in the profits.

Many people still have an outdated perception of Cambodia, but private-equity investors - so often the bellwether for the hot investments of the future - are moving into the country at apace.

At least four new private equity funds, backed by brand-name investors, are aiming to bring $475 million of foreign investment into Cambodia.

Money pouring into the country

China, South Korea and Malaysia have also been pouring money into the country and in 2006 foreign direct investment totalled $2.6 billion, up from just £240 million in 2004. And according to Cambodian Investment Board, (CIB) more than $6 billion may be invested in the country in the next three years.

A spokesperson for the CIB revealed: "Cambodia's economy expanded by 9.6 percent in 2007, and by more than 10 percent per year during the previous three years. Tourism arrivals have also grown, to 2 million in 2006, and by a further 20 percent in 2007".

Cambodians are getting richer too. And this increased wealth in the capital; the growing number of investors; and the increasing number of tourists are all helping to boost Phnom Penh's real estate market.

A new era of growth?

A spokesperson for David Stanley Redfern Ltd commented: "Phnom Penh is still at the beginning of a growth era, like Bangkok 20 years ago or Ho Chi Minh City 10 years ago.

"Property prices are cheap but they are moving fast - a traditional shop house along the river that sold in 2006 for $300,000 is now going for $600,000 to $700,000".