The government of Cambodia has been making concerted efforts to draw ininternational capital for the real estate industry.. Since Cambodia’s economy is expected to grow to 7.3% GDP by 20
Company overview
Vision, Misions & Core values
*Vingroup Joint Stock Company (Vingroup JSC): The company was founded by property developer and entrepreneur Phạm Nhật Vượng in Ukraine in 1993 as Technocom and was originally producing food products.
“Vingroup aims to develop into a leading Technology – Industry – Services group in the region.”
“To Create a Better Life For People”
“Credibility - Integrity - Creativity - Speed - Quality - Humanity”
Business performance
Technocom (founded in 1993 in Ukraine)
Field Producing dired foods (such as instant noodles).
Focusing on different fields(technology, industry, real estate, retail, and services ranging from healthcare to hospitality).
VinGroup is a conglomerate that operates in various fields, including real estate, hospitality, retail, healthcare, education, and automobile manufacturing.
VinGroup's real estate arm, Vinhomes, is one of the largest real estate developers in Vietnam It specializes in high-end apartments, villas, and urban areas Vinhomes has completed multiple projects in major cities, including Hanoi, Ho Chi Minh City, and Da Nang.
Vinpearl is VinGroup's hospitality brand, which owns and operates luxury hotels and resorts throughout Vietnam Its properties include Vinpearl
Resort & Spa, Vinpearl Convention Center, and Vinpearl Discovery.
VinCommerce is VinGroup's retail arm, which owns and operates VinMart supermarkets and VinMart+ convenience stores As of September 2020, there were 2,524 VinMart+ convenience stores and 122 VinMart supermarkets under VinCommerce's operation in Vietnam.
In addition to Vinmec International Hospital, Vingroup also operates Vinfa pharmacies, a network of healthcare facilities offering a wide range of medical services.
VinUni is VinGroup's education brand, which collaborates with renowned international universities to offer high-quality education programs in various fields, such as business, engineering, and healthcare VinUni's campus is located in Hanoi.
On the other hand, Vinschool education institution offers programs from pre-school to high school level with a focus on cultivating critical thinking, creativity, collaboration, and communication skills among students.
Vingroup owns VinFast, a subsidiary that produces automobiles, electric motorcycles, and electric bicycles.
The company also operates VinBus, a public transportation system in Vietnam's major cities.
Business performance
Cars: around 24000 vehicles were purchased, of which 7400 were electrical vehicles.
E-motorcycles: 5 brand new models with LFP batteries were successfully launched, achieving 60000 vehicles sold and +36% YoY.
Operation: 110 showrooms were globally opened, including in the U.S., Germany, France, and Canada 120 digitization projects were completed.
Marketing: 11 global auto shows were attended; organized Vietnam Elite Tours.4 4.2 Real estate and Services.
Vinhomes: net profit after tax obtained 97% initial target (VND 29.0 trillion vs VND 30.0 trillion).
Vincom Retail: Outperformed FY2022 Plan FY2022 leasing revenue and net income achieved VND 6.8 trillion and VND 2.7 trillion respectively.
VinPearl: nearly 1.3 million room nights were sold, principally attributed to the Year-over-Year recovery in Phu Quoc, Nha Trang, Dang Nang, and Quang Nam.
Unit 4Q2022 4Q2021 YoY (%) FY2022 FY2021 YoY (%)
Country notebook
General country indicators
Agriculture remains the main source of income for many Cambodians, but the economy of Cambodia is heavily dependent on tourism revenues and garment exports Cambodia is one of the poorest countries in Asia, however thanks to this,
Cambodia’s economy grew at an average annual rate of 7.7 percent between 1998 and 2019, making it one of the fastest-growing economies in the world.
Over the two decades before COVID-19 struck in 2020, Cambodia blossomed economically Having reached lower middle-income status in 2015, it set its sights on attaining upper middle-income status by 2030.
Cambodia’s economy continued to recover in 2022, especially in the services sector which is driven largely by pent-up consumer demand
GDP in Cambodia is expected to reach 31.88 USD Billion by the end of 2023,according to Trading Economics global macro models and analysts’ expectations
- Most of the new condo projects are overpriced, yet shophouse apartments are incredible deals in certain areas.
- Phnom Penh is also one of the few capitals in the world where you can purchase property for below US$1,000 per square meter Our strong belief is that property values in Cambodia will only increase from here.)
Cambodian culture is conservative and hierarchical, and Theravada Buddhism is practiced by 95% of the population Followers adhere to the concept of collectivism – the idea that the family, neighborhood and society are more important than the wishes of the individual – and as in many Asian cultures the sense of ‘face’ is also considered paramount.
A Khmer-style shophouse is easy to identify and is one of the most common property types in Phnom Penh, often built up into three or four-story low-rise row homes
This type of apartment can be found in nearly every Phnom Penh neighborhood A Khmer-style shophouse is generally four meters wide by 16 meters long The entrance is typically in the front or back of the apartment and the walls on either side have no windows.
Bedrooms don’t commonly have windows, and if they do, they will face the interior of the home, not outside Bedrooms usually will not have closets and instead have movable dressers or rattan shelving.
The kitchen in a Khmer-style shophouse is normally very basic: a sink, two or one- burner gas cooktop, sink, and often lacking cabinet storage Bathrooms are also basic with no separate shower, floor-to-ceiling tiles, and no windows Other home furnishings will also be sparse and be either rattan or wood In terms of furnishings, you can expect chairs or a loveseat, a coffee table, and a table for eating.
The average monthly income of Cambodian people is around $200 The poverty rate in Cambodia has decreased from 47.8% in 2007 to 13.5% in 2019.
The average monthly expenditure of a Cambodian household is around $200 The largest expenditure for Cambodian households is food, which accounts for 50% of their total expenditure.
On October 15th 2021, the Government of Cambodia adopted a new Law on Investment that aims to boost foreign investment The new law will replace the Law on Investment of 1993, as revised in 2003 The new Law aims to create an open and transparent legal framework for investment, as well as to attract and promote quality, efficient and effective investment tailored to support socio-economic development.
Investment incentives: establishing an investment incentive regime that is transparent, predictable, non-discriminatory, competitive, and supportive of socio-economic policies Incentives are offered in 19 sectors, including high-tech industries involving innovation or research and development, notably through a mechanism of tax-related basic incentives, additional incentives and special incentives;
Investor guarantees: a set of protective measures are granted by the law to investors and their assets, including non-discrimination, guarantees against nationalization and arbitrary expropriation, free transfer of funds, intellectual property protection etc.
Investment procedures: the new law revises and improves administrative procedures for applying for registration of qualified investment projects (SEC) , a basic introduction to some technical aspects addressed in the law, such as registering and transferring an investment project.
The government of Cambodia has been making concerted efforts to draw in international capital for the real estate industry By upgrading domestic sectors and defending investor rights, Cambodia unveiled a new investment legislation in late 2021,hoping to make the nation more appealing to overseas investors A number of incentives are available under the new law, including incentives for customs duties and income tax exemptions The law also reinforces the nation’s prior investment guarantees and safeguards for foreign investors, including the outlawing of foreign exchange controls and discrimination against foreign investors, the protection of intellectual property, and the assurance of protection against price-fixing, nationalization, or unjust expropriation by the government.
Market potential
One of the main advantages of investing in Cambodian real estate is its affordability Prices are relatively lower compared to neighboring countries like Thailand.
Bars chart of Average square meter prices in US$ of 120-sq.m apartments located in the center of the most important city of each country (Source: Global Property Guide)
The average price for an apartment in Siem Reap in 2022 is between USD 68,000 and USD
163,000, and the average rental is around USD 400 to USD 450 per month This makes it an attractive destination for those looking for good value for their investment in Cambodia.
The "rental yield" or “yield” of a property tells you how much money you are likely to earn on your investment each year It is calculated by expressing the annual rental income earned from a property as divided by how much the property costs.
Cambodia boasts competitive rental yields, which are often higher than those in more developed markets
“The property market is seeing growing interest from overseas buyers looking for a bargain and strong returns Average rental yields are some of the best in Asia, exceeding 5% in cities like Phnom Penh and Siem Reap.” as Matt Lavin, Director at Benoit Properties International said.
Among countries in Asia, Cambodia has one of the best rental yields for investors, amounting to an average of 5.33% GRY as reported by Global Property Guide In Phnom Penh alone with that GRY, the average buying price for properties is at $349,560 with a standard of $1,553 rent per month
Since Cambodia’s economy is expected to grow to 7.3% GDP by 2022 and real estate being one of the main driving factors of economic growth, your return on investment is high
Investors can benefit from steady rental income in addition to the potential for property appreciation.
2.3 Stabilised Political Environment and Favorable Legal Framework:
After many conflicting years, Cambestatodia’s political environment stabilized, opening the way for economic development and growth with increased property investment This stabilization by the Cambodian government infused trust and confidence in real estate investors, including foreign and local investors.
The Cambodian government has also implemented several policies to make it easier for foreign investors to own property These regulations provide stability and security to foreign investors.
The Industrial Development Policy 2015 – 2025 (IDP) sets out clearly these challenges and rolls out the need to diversify the economy and avoid over-reliance on garments The plans to diversify the economy are also set out in the Rectangular Strategy Phase IV, through, for example, efforts to reduce the cost and time in setting up a business as well as promoting a strong trade and investment climate.
The Government has continued its effort to maintain and promote a conducive investment environment by setting out prudent macroeconomic policies to maintain a manageable inflation rate, stabilize the exchange rate and other related policies such as comprehensive tax reforms.
Cambodia’s tourism industry growth could impact the real estate market in the country.
Tourism drives economic growth; hence, the government substantially invests in it Tourism growth may increase demand for real estate in areas popular with tourists, like Siem Reap and Sihanoukville.
The government’s plans to create airports and roadways for tourists are expected to affect the real estate market These developments will improve connectivity and accessibility to popular tourist destinations, making them more attractive to investors and developers.
Short-term rentals like vacation houses and serviced apartments are projected to rise as the tourism industry grows Property developers who focus on these types of properties may see strong returns in the coming years.
The rise in international tourism has resulted in a strong demand for rental properties, making it an ideal time to invest in the market.
2.5 Urbanization and Growing Middle Class:
Urbanization largely contributed to Cambodia’s real estate industry and economy,benefitting investors Urban centers’ development attracted many businesses and job options, creating the need and boosting the demand for property and lands nationwide,contributing to economic growth People from different nations and cultures created cultural diversity and boosted lifestyles across the Cambodian region It increased the need for improved infrastructure, services, and places, making investors deal with the real estate market.
The economic growth of Cambodia is due to the growing and substantial middle class since fifty percent of the region’s populace is middle class It paved the way for businesses to offer their properties to the middle class, a clientele that expanded rapidly With their demand for properties, including modern infrastructure, housing, and commercial spaces,the growing middle class contributed to Cambodia’s real estate growth and indirectly to the nation’s economy It enticed many national and international developers to offer their properties to the ever-expanding middle class.
Barriers to entry
Most of the development in Siem Reap has been focused on tourism and hospitality services Normally hotels open and close on an almost monthly basis According to Knight Frank, there are currently 4 hotels with more than 50 keys in the pipeline with 740 keys across the board.
However, with the increasing number of locals moving to live and work in the downtown area, the land prices have been unsurprisingly risen “Condo developments and western style single-family homes with minimum three bedrooms, pool and parking spaces, prices have been stable or increased by 15 to 20 percent, as demand increased from wealthy local buyers looking for a second home investment in Siem Reap.”, said Andreas Reiterer,founder and director of Dabest Properties, a boutique real estate agency set to service both local and international clients across Cambodia since 2018.
Vingroup also has to face local giants According to Knight Frank, Borey Tourism City, a borey developed by OCIC, is the largest existing project with more than 60 hectares of land area The project offers single villas, twin villas, and flat houses as well as leisure facilities.
OCIC seems to have struck gold as all their units were sold out in their first and second phases.
Other major projects such as Les Bijoux D’Angkor, Borey Angkor Palace, Bakong Village, Angkor Grace, and Vnom Empire are still under development in Siem Reap.
Cambodia offers many opportunities for real estate investors, especially in the condominium sector However, land remains Cambodia's most sought-after and lucrative avenue for real estate investment.
According to a survey, land accounts for 36.6% of the total investment preference in 2023, up from 22.74% in 2022 The land is highly sought for its scarcity, versatility, and
25 appreciation potential As a city highlighting the tourism of the country, land prices in Siem Reap can vary significantly depending on the plot's location, size, and zoning.
According to the law, foreigners cannot buy land in Cambodia This is following Article 44 of the Cambodian Constitution which states that: “Only Khmer legal entities and citizens of Khmer nationality shall have the right to own land.” Foreigners can't own Cambodia land outright but alternatively, foreigners can own 49% of the land and they need to partner with a Cambodian legal entity that has 51% or more of its shares held by Cambodian citizens.
Therefore, one of the strategies we can execute is investing in a land-holding company with a Cambodian citizen.
However, the main concern with this method is a lack of trust in your Khmer counterpart In using this method, you must choose a partner you trust Furthermore, a land-holding company is more legally secure but requires annual licensing fees and monthly tax filing.
You’ll easily pay $10,000 annually for this structure, which eats into returns if you aren’t investing well above $1 million.
All development business for condominiums, land lots, office buildings, malls and residences for the purpose to sell or lease long-term (referred to as land or building leases for over 15 years) must be licensed by the Ministry or permitted by the Provincial- Municipal Department.
Any person or company who wishes to run more than 30 apartments or 30 villas for a residential development business or co-owned building, or more than 30 condominium units, or a development lot of more than 10,000 square meters must apply for a license from the Ministry of Economy and Finance.
According to a Prakas No 089 SHV.PRK dated 20 January 2020 on “The Management of Real Estate Development Business,” one license or permit is only available for one development site If a project of a residential or co-ownership building development business comprises many development phases, each license or permit is given only for each
27 phase of the project Therefore, property development businesses must have a license or permit depending on the type and size of the property development.
- The global strategy is a plan of action that an organization formulates to guide its international business operations It involves identifying target markets, developing products and services that meet the needs of customers in different countries, and creating a marketing mix that appeals to consumers in diverse cultures A global strategy aims to standardize products, services, and marketing across different countries to achieve economies of scale and reduce costs.
- Localization strategy is a plan of action that an organization formulates to adapt its products, services, and marketing to meet the unique needs of customers in different countries or regions Localization involves modifying products and services to meet local regulations, cultural norms, and language requirements It also involves creating marketing campaigns that resonate with local consumers using local idioms, images, and symbols.
1.2 Explanation for the company’s choosing Localization Strategy.
- The cost in Cambodia is an important factor that affects Vingroup’s real estate investment.
According to our group’s research, 3 main factors constitute the local pressure for investors in Cambodia:
The cost of land: the cost of land in Cambodia is relatively high compared to other
Southeast Asian countries, especially in urban areas such as Siem Reap
The bar chart gives information about the cost of land in Siem Reap from 2021-2022.
According to research, the price value of land has seen a huge increase in average value throughout 2021 up to 2022 Considering the median price was at $285,000 in March of 2021, it skyrocketed in July of the same year by 387.88% to $878,180
However, it decreased by 55.68% in that September to $380,000 and has remained a bit steady in that price value since The current average price of land since February 2022 remained to be $350,000 By observation, the fluctuation of land cost throughout different periods in 2021-2022 still stops at $350,000, which is a fairly high cost for any investors, including Vingroup, a corporation with large financial resources If they invest, Vingroup will have to do that with a large amount of capital to acquire land for its real estate projects, which might increase its financial risk and reduce its return on investment.
The cost of construction: the cost of construction consists of numerous factors such as the cost of materials, labor, equipment, and other expenses such as permits, taxes, and insurance.
The cost of materials: our group would love to mention the two most well- known materials in construction: cement and steel As Cambodia is a country that is located next to Vietnam, Vingroup can find it easier to use Vietnam’s domestic construction supplies brands due to the low cost of transportation
First of all, the price of construction cement ranges from 75,000 dongs to 98,000 dongs per 50 kg bag, depending on the brand and type of cement
Some popular cement brands used in Cambodia are Ha Tien, Thang Long, Insee (Sao Mai), Cam Pha, Nghi Son, and Hoang Thach
Cement price of Vietnam’s brands.
Second of all is the price of steel A significantly famous steel-producing brand in Vietnam is Hoa Phat Company The price is 14,800 VND per Kg for ỉ 6 & ỉ 8 and ranges from 107,429 to 1,092,684 VND per bar for ỉ 10 to 32.
This shows a variety of steel supplies for Vingroup to choose from when they decide to invest
Steel price of Hoa Phat.
=> If the other costs are too high, they can select suitable prices for cement and steel to lessen the financial burden.
Labor cost: Labor cost in Cambodia is relatively low compared to other countries, due to the low labor costs and abundant natural resources The average wage of a construction worker in Cambodia was $6.67 to $65.67 per day, depending on the type and level of work in 2022 Vingroup can lower its production costs and increase its profit margins by building its real estate projects in Cambodia, which might enhance its competitive advantage and market share.
Company strategy
Mode of entry
Mode of entry: An entry mode describes a company's approach to entering a new foreign market that has not been targeted by the company before.
Table: Advantages and Disadvantages of Entry Modes
Exporting - Ability to realize location and experience curve economies
- Increased speed and flexibility in engaging target markets
- High transport costs - Trade barriers - Problems with local marketing agents
- Ability to earn returns from process technology skills in countries where FDI is restricted
- Creation of efficient competitors - Lack of long-term market presence
Licensing - Low development costs and risks - Moderate involvement and commitment
- Lack of control over technology - Inability to realize location and experience curve economies - Inability to engage in global strategic coordination
Franchising - Low development costs and risks - Possible circumvention of import barriers, and strong sales potential
- Lack of control over quality - Inability to engage in global strategic coordination
- Access to local partner’s knowledge
- Shared development costs and risks
- Politically acceptable - Typically no ownership restrictions
- Lack of control over technology - Inability to engage in global strategic coordination - Inability to realize location and experience economies
- Protection of technology - Ability to engage in global strategic coordination - Ability to realize location and experience economies
- High costs and risks - Need for more human and nonhuman resources and interaction and integration with local employees
The group proposed that the business's Mode of Entry is Joint ventures and the business that Vingroup can best cooperate with is Borey Peng Huoth because this group develops and focuses on one field: investment Privately, the two businesses have quite similar products and visions to our Vingroup.
Image: IllustrationThe group recommends Joint Ventures because:
● Cambodian law: With the product we mention here, land, an extremely specific asset, the entry and exit methods of businesses will be less diverse
According to Article 44 of the Cambodian Constitution, only natural or legal persons with Khmer nationality have the right to own Cambodian land.
○ It will be more convenient when Vietnam and Cambodia have signed many agreements for mutual development, such as being members of ASEAN; Agreement Concerning the Promotion and Reciprocal Protection of Investments between Vietnam and Cambodia; Trade Agreement between Cambodia and Vietnam.
○ With its reputation in the Vietnamese market, it is completely easy for Vingroup to find a government or private partner to jointly develop the market in Cambodia.
● Competitors: After institutional reform, Cambodia has become a more open market, so the real estate market in Cambodia also attracts many powerful competitors, typically from China The market is more competitive so the success rate will decrease Therefore, Joint ventures will help Vingroup penetrate the market more safely, reducing risks when understanding the needs of local people.
● Flag orientation: Mr Pham Nhat Vuong, chairman of Vingroup, once spoke in an exchange with Viettel Group Vingroup's problem of going abroad is not profit-oriented, but the orientation is to plant a flag, so success in the Cambodian market will be the foundation for future steps in the presence of a Vietnamese enterprise South in the international arena
Image: Mr Pham Nhat Vuong and the sharing session with Viettel
→ In summary, the benefits of the Joint Venture method are:
- Ensuring legal issues between the two countries (Vietnam; and Cambodia) - Easy access to local partners' knowledge
- Easily integrate into the culture of the region - Share costs and risks
- True to one of the goals of the business is to plant flags
Suggestions to improve global in the marketing
Marketing plan for businesses is based on the 4Ps of the Marketing mix model
Image: Illustration of 4Ps of marketing mix
- About the field Vingroup's commercial services, specifically Vinpearl, owns a chain of hotels, resorts, spas, conference centers, cuisine, 5-star golf courses, and entertainment areas according to international standards The hotel is located in a famous tourist attractions.
- Design style: The famous location that Vingroup is targeting will be Angkor Wat temple Therefore, instead of following a modern, Western design style, Vingroup can design in Khmer style, taking ideas from palaces, temples, and pagodas here Will highlight the business's products compared to competitors, especially foreign competitors who do not use the mode of entry Joint ventures method Foreign tourists visiting want to experience a traditional living space, domestic guests will also experience a classy yet familiar living space.
Image: Illustration of hotel of Cambodia structure
- After the Covid-19 pandemic, the economy is on the road to recovery After a period of social isolation, people around the world now have a huge need for travel In addition, due to newly entering the market, they are selling rooms with many discounts and earning profits with accompanying services such as spas, restaurants, entertainment services, and golf courses This campaign may be optimal in the early stages to promote customer recognition of the emerging brand in the international market.
- Then when demand stabilizes, Vingroup can reduce selling prices, but the selling price here will not be higher than in Vietnam because according to Statista.com statistics: Cambodia's GDP Per Capita in 2022 is 1784.79 expected to increase to 1896.13 in 2023 compared to Vietnam 'ss GDP Per than Cambodia Therefore, the selling price will not be higher than 300$/1 per night (reference price for Vinpearl Phu Quoc)
- According to the Cambodian Ministry of Tourism: Tourism demand in Cambodia: In the first 5 months of 2023, Cambodia has welcomed more than 2.16 million international tourists, an increase of 530% over the same period in 2022 Growth assessment Beyond this breakthrough, Minister of Tourism Thong Khon expects that in 2023, Cambodia will welcome about 4.5 million international tourists and will increase to 7 million in 2025 or 2026 Along with that, the Government Cambodian government has introduced several additional measures to support the reopening and recovery of tourism businesses Such as Tourism co-financing projects, monthly tax exemption, and value-added tax exclusions for hotels, motels, and tour operators in Capital Phnom Penh, Siem Reap province, and Preah Sihanouk province, and training for employees in the tourism sector.
- The target customers of the proposed business include foreign tourists When mentioning Cambodia, people will immediately think of Angkor Wat temple located in Siem Reap province, one of the 7 wonders of the world recognized by UNESCO receive In addition, in Siem Reap province, the infrastructure is relatively good, with an international airport and a massive road system In addition, the Cambodian government is very interested in this province.
- Therefore, it can be seen that Siem Reap Province will be the ideal location for Vingroup's initial globalization.
Image: Illustration of Temple of Angkor Wat
- Vingroup is one of Vietnam's leading corporations, so the influence and resonance of this first step are huge Throughout 2022, there will be an average of about 12.3 million monthly active social media users in Cambodia with an annual growth rate of 5% during 2021-2022 With a population of nearly 17.5 million people, this number accounts for about 73.9% of the total population As for the world, there are 4.8 billion social network users worldwide, accounting for 59.9% of the global population From there, communicating on social networks, combined with KOLs, will be an appropriate, optimal, effective, and economical strategy.
Recommendation and Implementation
Recommendation
Based on Vingroup’s real estate expansion strategies and Cambodia’s real estate policies, here are some recommendations for policy-makers and authorities in Cambodia to support Vingroup’s real estate market expansion:
To attract more foreign investment to Cambodia, the government should simplify the approval procedure for real estate projects It will be easier for Vingroup to grow as a result.
To facilitate people's access to innovations, the government of Cambodia should invest in infrastructure, such as roads, bridges, and public transit Vingroup would be able to draw in additional investors and clients as a result.
The government of Cambodia may provide tax breaks to international businesses that make investments in the nation's real estate sector Vingroup might find it more appealing to expand in Cambodia as a result.
The government of Cambodia should encourage renewable energy sources and green building techniques to promote sustainable development This would assist Vingroup in standing out from rivals and attracting clients who care about the environment.
Guidelines for the Implementation Plan
2.1 Long-term investment: As the country recovers from the pandemic, positive signs are emerging, with the tourism sector thriving and Cambodia gaining popularity on the global map as a destination in Southeast Asia The projected number of international tourists for this year stands at 4.5 million, as reported by the Ministry of Tourism As Cambodia aims to become a high-middle-class country by 2030, there is a potential to attract a more demanding audience looking for modern, well-designed commercial and residential properties, as well as greener spaces This presents a lucrative market for developers and investors who can cater to the evolving needs of the emerging middle class and both local and international tenants With the right strategies and foresight, real estate ventures in Cambodia hold great potential for long-term success.
Since the COVID-19 pandemic started, foreign buyers seem to have moved from wanting to buy completed homes to buying land to build their own homes The property market in Siem Reap has cooled down nowadays compared to the beginning of COVID-19 Buyers have only been focusing on distressed property sales and land being sold at under-market prices
Some of these buyers are relocating from other countries to Cambodia, and Siem Reap is their preferred destination due to the attractive lifestyle here Other buyers are locals and foreigners living in Phnom Penh and are seeking to relocate to Siem Reap to escape the increasing traffic, pollution, and other issues associated with the over-urbanisation of the city (David Granger, the Branch Manager of IPS Siem Reap)
In terms of financial reasons, Siam Reap is experiencing the growing trend of buying lands to build as it saves between 30%-40% of the purchase price It is also worth noting that the popularity of Siem Reap has only been “relatively recent,” so land prices in this region are still considerably lower compared to other urban cities in Cambodia.
Since this is a foreign investment, Vingroup should make use of 3D visualization to give the organization the best view of the project
Nowadays, the architectural design in Cambodia in general is heavily influenced by the French due to their colonization in history However, there is a parallel movement that draws inspiration from the long and abundant history of Cambodian aesthetics, namely, the New Khmer architecture
In addition to this, as a country famous for various historical sites, it is considered a threat to the “identity” of Cambodia when Western design architects keep appearing “As the ministry’s policy states, we want the architecture of new buildings to showcase Cambodian identity as much as possible,” (Pheung Sophorn, state secretary of the Ministry of LandManagement, Urban Planning, and Construction) Therefore, it would be a smart strategy ifVingroup included the elements of Khmers’ culture in their building design, such asAngkorian ornaments and Bayon Temple smiling stone faces At the same time, the amenities must be the-state-of-the-art.
Delving into the opportunities within property development, the management of development projects and partnerships, and how to optimize returns through strategic sales or leasing practices of Vingroup
Successful property development necessitates cooperation with various stakeholders, including architects, contractors, and government agencies Efficient project management and partnerships are crucial to ensuring the success of any development endeavor.
1 Comprehensive Planning: Collaborate with skilled architects and designers to create a viable and appealing plan that caters to market needs and adheres to local building codes and regulations.
2 Selecting Contractors: Opt for reputable and dependable contractors with a history of delivering high-quality results within the specified time and budget constraints.
3 Compliance with Regulations: Guarantee that your development project follows all required permits, licenses, and regulations, including obtaining approval from the
4 Ongoing Supervision: Consistently oversee your development project’s progress, promptly addressing any complications or setbacks to reduce costs and guarantee a timely completion.
Vingroup will choose the option for the foreign investor to invest in land through a trust arrangement The Trust Law was promulgated on 2 January 2019 by Royal Decree № NS/RKM/0119/002 (“Trust Law”) Trust Law (and implementing sub-decrees) represent a promising legal development for investors in Cambodia.
Under the Trust Law, a trust may be created by a trustor or by applicable regulations If the trust is created by the trustor, the trustor must transfer its property or funds to the trustee through the trust instrument by specifying the specific purpose of the trust and/or the identity of the beneficiary The Trust Law sets out the role, rights, and responsibilities of the trustor (who establishes the trust), the trustee (the registered owner of trust property), and the trust’s beneficiaries (who benefit from the trust).
Real Estate Investment Guide Cambodia - 2023 11 A trust agreement must have three parties: a trustor, a trustee and a beneficiary Under a trust agreement, the trustor transfers property or funds to the trustee The trust agreement must be registered with the TrustRegulator.
All trusts must be approved by the Trust Regulator The trustor or grantor must propose the appointment of trustee(s), duly licensed by the Trust Regulator, for the Trust Regulator’s approval (Article 8 of Prakas 003) Upon the registration of a trust, a certificate of trust registration will be provided by the Trust Regulator (which is valid for five years from the date of its first registration) The appointed trustee(s) shall proceed with the process of applying for approval to form a trust and, on behalf of the trustor or grantor, register the trust with the Trust Regulator (Article 54 of Prakas 003) A trust is valid from the date of registration with the Trust Regulator.
A trustee can be a legal entity (trustee company) or individual person (individual trustee) A trustee must first be licensed and/or approved by the Trust Regulator The individual trustee can be licensed to act as (i) an independent individual trustee; or (ii) an individual trustee of a trustee company.
To enhance returns from Vingroup’s property development, it is essential to adopt tactical strategies when selling or leasing finished properties
Begin with market placement, positioning property strategically to target the ideal audience while setting competitive pricing based on comprehensive market research and analysis.
Implement a well-rounded sales and marketing strategy to advertise the property, using channels like online platforms, local advertisements, and real estate agents
For those leasing properties, ensure transparent lease agreements and terms, and consider partnering with property management firms for efficient and professional handling of properties
Lastly, monitor market conditions and trends closely to identify the most opportune moment to sell or lease your properties, maximizing returns and minimizing vacancy rates.
1 Cambodia Construction Industry Databook Series – Market Size & Forecast (2016 – 2025) IPS Cambodia (2022) https://ips-cambodia.com/cambodia-property-market- first-quarter-2022/
2 Cambodia Property Rates - The Trend in the Real Estate Property Market IPS Cambodia (September 18, 2019) https://ips-cambodia.com/cambodia-property-rates/
3 Cost of Living in Siem Reap LivingCost.org https://livingcost.org/cost/cambodia/siem-reap 4 Cost of Living in Ho Chi Minh City LivingCost.org https://livingcost.org/cost/vietnam/ho-chi-minh 5 Types of licenses or permits for real estate business in Cambodia Cambodia
Property News (July 15, 2019) https://www.cambodiaproperty.news/types-of- license-or-permit-for-real-estate-business-in-cambodia/
6 Average Salaries in Cambodia IPS Cambodia Real Estate (January 4, 2023) https://ips-cambodia.com/average-salaries-in-cambodia/
7 Construction & Labor Workers | KH | Average Salary Survey 2023 Average Salary Survey https://www.salaryexplorer.com/salary-survey.php? loc6&loctype=1&job&jobtype=1 8 Cambodia Minimum Wages - 2023 Data - 2024 Forecast - 2012-2022 Historical -
Chart Trading Economics https://tradingeconomics.com/cambodia/minimum-wages 9 Cambodia Real Estate Market Trends: What to Expect in 2022 IPS Cambodia Real
Estate (January 11, 2022) https://ips-cambodia.com/cambodia-real-estate-market- trends/
10 Cambodia’s land and Property Market in 2023: Essential Tips for Prospective Investors (August 30, 2023) https://www.juwai.asia/main/news/9540
11 2023 Real Estate Trends in Cambodia (2023) https://kwcambodia.com/2023-real- estate-trends-in-cambodia/
12 Living in Phnom Penh vs Siem Reap: Which city suits you best? (July 7, 2023) https://ips-cambodia.com/phnom-penh-vs-siem-reap-ifestyle/#:~:text=Phnom
%20Penh%2C%20the%20bustling%20capital,focus%20on%20preserving
%20Cambodian%20culture 13 Siem Reap: What you need to know before you go (2022) https://vi.hotels.com/go/cambodia/siem-reap#:~:text=Siem%20Reap%20is%20the
%20gateway,traditional%20markets%2C%20and%20cultural%20performances 14 Climate and Average weather year round in Siem Reap (2023) https://weatherspark.com/y/114683/Average-Weather-in-Siem-Reap-Cambodia- Year-Round#google_vignette
15 Siem Reap in Cambodia (July 2023) https://www.euromonitor.com/siem-reap-in- cambodia/report
16 Choeun Sreynoy (February 6, 2022) More accommodation businessed embrace Khmer traditional design https://cambodianess.com/article/more-accommodation- businesses-embrace-khmer-traditional-design
17 Lalaine C Delmendo (October 17, 2021) Phnom Penh’s housing market woes https://www.globalpropertyguide.com/asia/cambodia/price-history 18 Vingroup Company (Vingroup JSC): General introduction (2022)
19 Vingroup Company (Vingroup JSC): Financial statements & presentations (2023) https://vingroup.net/en/investor-relations/financial-statement 20 Vingroup https://en.wikipedia.org/wiki/Vingroup
21 Number of VinMart supermarkets and VinMart+ convenience stores under VinCommerce in Vietnam from 2018 to September 2020 (2023) https://www.statista.com/statistics/1192074/vietnam- number-of-vincommerce-supermarkets-and-convenience-stores/
22 Báo cáo thường niên 2022 của Vingroup.
24 Campuchia kỳ vọng đón 7 triệu khách du lịch quốc tế vào năm 2026 (June 22,
2023) https://bvhttdl.gov.vn/campuchia-ky-vong-don-7-trieu-khach-du-lich-quoc-te- vao-nam-2026-20230622105518514.htm
25 Top 10 best luxury hotels & resorts in Cambodia (May 18, 2020) https://theluxurytravelexpert.com/2020/05/18/best-luxury-hotels-cambodia/
26 An Bình (March 11, 2022) Được đầu tư mạnh, du lịch Siem Reap Campuchia muốn ‘chuyển mình’ (Cổng Thông tin điện tử Bộ VHTTDL) https://bvhttdl.gov.vn/duoc-dau-tu-manh-du-lich-siem-reap-campuchia-muon- chuyen-minh-20220310163050968.htm
27 Social media in Cambodia – 2023 stats & platform trends (October 30,2023) https://oosga.com/social-media/khm/#:~:text=How%20are%20users%20distributed
%20in,73.9%20%25%20of%20the%20total%20population 28 134 Social media statistics you need to know for 2023 (July 14, 2023) https://www.searchenginejournal.com/social-media-statistics/480507/#:~:text=Social
%20Media%20Statistics%20Worldwide&text=There%20are%204.8%20billion
%20social,increase%20year%2Dover%2Dyear 29 Văn Đỗ/VOV-Phnom Penh (January 3, 2023) GDP bình quân đầu người
Campuchia dự kiến đạt gần 2.000 USD trong năm 2023 https://vov.vn/the-gioi/gdp- binh-quan-dau-nguoi-campuchia-du-kien-dat-gan-2000-usd-trong-nam-2023- post994229.vov
30 Cambodia: Gross domestic product (GDP) per capita in current prices from 1998 to 2028 (2023) https://www.statista.com/statistics/438362/gross-domestic-product- gdp-per-capita-in-cambodia/
31 Rebecca Hartley (August 30, 2016) Things to do in Kampot when it’s raining https://movetocambodia.com/blog/page/28/? fbclid=IwAR0mURkTM8j3rwosXoLCnGTljjDaXuttvy75yRbyxF8qMdtiuHpV- 3yLGWs
32 New investment law aims to boost foreign investments (September 9, 2021) https://investmentpolicy.unctad.org/investment-policy-monitor/measures/3745/ cambodia-new-investment-law-aims-to-boost-foreign-investments 33 Business etiquette, language & culture (2022) http://www.cambodia.doingbusinessguide.co.uk/the-guide/business-etiquette,- language-culture/
34 Overview: Development news, research, data of Cambodia (The World Bank – IBRD-IDA) https://www.worldbank.org/en/country/cambodia/overview 35 Vingroup Company (Vingroup JSC) 4Q2022 Earings Presentation (January 31,
2023) https://vingroup.net/viewer.html?file=https%3A%2F%2Fircdn.vingroup.net
%2Fstorage%2FUploads%2F0_Quan+he+co+dong%2F0_Vingroup_2023%2FJan