Sihanoukville Tourism & Property Market Update 2020

Overview

Once a quiet coastal village, Sihanoukville’s rapid transformation into a megacity has left developers questioning what comes next, as the government’s online gaming ban emerges as a major market disruptor.

SIHANOUKVILLE INTERNATIONAL AIRPORT ARRIVALS

Sihanoukville was originally a peaceful coastal village set in the southwest of Cambodia. In the past, it attracted mostly Western tourists and was once a weekend getaway destination for locals. However, starting in 2017 the dramatic inflow of Chinese investment driven by the Belt and Road Initiative has changed the seaside town completely.

Prior to 2016, only limited domestic and charter flights served Sihanoukville airport. The emerging market has drawn attention from various segments especially the gambling sector and brought hundreds of thousands of Mainland Chinese workers and investors to the city. As of YTD October 2019, the city’s main gateway Sihanoukville International Airport hosted 602,755 passenger arrivals, which is a 266% y-o-y growth compared to the same period in 2018. Land values, rents and condominium sales prices have skyrocketed during a three-year period due to the surging demand and massive development of the city.

Without a doubt, the Cambodian ban of online gambling, driven by the Chinese government has hit the tourism and real estate sector hard. Yet, ongoing construction of public infrastructure and development of Sihanoukville Special Economic Zone (SSEZ) will likely contribute to stabilizing development in the medium to long term.