Cambodia an ideal destination for hotel investment: experts

03 Sep 2019 2111 | Cambodia Travel News

A trio of experts from the economic and real estate sectors said tourism growth and several other factors make Cambodia one of the best places to invest in a hotel in Southeast Asia now.

Jayant Menon, lead economist at the Asian Development Bank (ADB), said Cambodia’s strong economic and tourism growth present opportunities for potential investors in the Kingdom’s hotel sector.

“With rapid economic and tourism growth, investing in hotels and the broader hospitality industry does appear to be financially attractive in Cambodia at present,” he told Khmer Times.

Jayant Menon, lead economist at the Asian Development Bank (ADB), said Cambodia’s strong economic and tourism growth present opportunities for potential investors in the Kingdom’s hotel sector.

“With rapid economic and tourism growth, investing in hotels and the broader hospitality industry does appear to be financially attractive in Cambodia at present,” he told Khmer Times.

But while the opportunities are there, he said investors should not rush and should instead carry out due diligence.

“However, hotel development is a ‘lumpy’ investment which involves a long gestation period. It can take several years to raise one, from scratch. There can also be herd behavior, where people rush in to develop new hotels without carefully considering how many other new ones are already in train,” he pointed out.

“Therefore, while attractive at present, due diligence is required to ensure unmet demand is being tapped several years in the future when the project is likely to be completed, in the specific location being targeted,” he added.

While agreeing with Mr Menon, Anthony Galliano, CEO at Cambodian Investment Management (CIM), noted that a surge of arrivals from China has greatly affected Cambodia’s hospitality sector.

“Although tourist arrivals have increased on average 11 percent per annum in the last two years, the demographic and the category of tourists have dramatically changed, thus impacting greatly the hospitality industry which must adapt to accommodate this new stratum of international tourists,” he said.