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Capital’s Third Ring Road lifts land prices in nearby areas

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Phnom Penh’s Third Ring Road will link National Road 3 to National Road 4 in the west and National Road 2 in the east. Hin Pisei

Capital’s Third Ring Road lifts land prices in nearby areas

With construction on Phnom Penh’s keenly-awaited Third Ring Road coming along, land prices along the project have managed to defy the Covid-19 real estate downturn evident across the capital, industry insiders have said.

In counter-clockwise direction from the northeast, blueprints show that the road is to connect National Road 6 to Win-Win Street, National Road 5, Kob Srov Road, national roads 4, 3, 2 and 21 before crossing the Bassac River through to National Road 1.

Two bridges across the Bassac River will be also constructed to link Koh Anlong Chin Island on both sides at a total length of 996m.

It will then connect to Phnom Penh Autonomous Port’s new container terminal in Kandal province’s Kien Svay district and back onto National Road 6 with an aggregate length of 52.98km.

At 27m wide in the capital and 25m outside, the road will be divided into two lanes in each direction, with a 3.5m wide garden serving as a median.

The road will also include a motorbike lane and a pedestrian sidewalk on both sides.

The project will cost $273 million, which will come from concessional financing by China, with a contribution from the Cambodian government dedicated to compensating residents impacted by the road’s construction, mine and unexploded ordnance clearing and paying royalties.

The project broke ground on January 14, 2019 and is slated to be completed by the end of next year.

The road is widely expected to help decongest the traffic-choked streets of the capital and enable better connectivity within the ASEAN region and the Greater Mekong Subregion (GMS), injecting significant impetus to the national economic growth.

Ministry of Public Works and Transport spokesman Vasim Sorya told local media on July 13 that construction on the road is 39.76 per cent complete and still on schedule. And last week he said that figure had reached “more than 40 per cent”.

Lucky Realty Co Ltd CEO Dith Channa told The Post on December 16 that land prices along the project had ticked up 15-20 per cent compared to the end of last year.

He noted that projects such as housing, shopping malls, industrial areas, factories and warehouses had sprouted up in the areas.

“The current price increase comes as road construction takes shape and is little by little opened up for traffic,” Channa said.

He pointed out that the most prevalent areas for land transactions along the road could be divided into four main regions.

Topping the list is the area near the segment between Prek Pnov Bridge and National Road 4 where land is valued at an average of $200-250 per sqm, he said.

The environs of the section linking national roads 3 and 4 ranks second at $150-200 per sqm, followed by the surroundings of the segment connecting national roads 3 and 21 at $100-150 per sqm and the partition linking national roads 21 and 1 at $50-100 per sqm, he added.

He noted that as Phnom Penh continues to expand, land prices along the road will increase accordingly.

Cambodian Estate Alliance CEA Co Ltd vice-chairman Sao Sakhom said prices were well into expansionary territory everywhere with some sites even doubling in price from the end of last year.

He noted that plots smaller than 1ha that were adjacent to the project exhibited the highest growth rates.

With the plethora of economic engagement opportunities the road brings to the table, Sakhom stressed that the surge in land prices was inevitable.

He noted that project construction development can be partitioned into three main phases – its announcement, its groundbreaking and its completion. “In my experience, land prices have doubled at each stage.”

According to Sakhom, prime land along the project can bring in as much as $450 per sqm for smaller plots and $200 per sqm for those in excess of 1ha.

But Cambodian Valuers and Estate Agents Association (CVEA) president Chrek Soknim was quick to point out that property prices along the project had risen a mere five per cent year-on-year.

“As I see it, the price of land along the road saw but a slight increase over the year-ago period, [and that] was due to the fact that it had already taken to great heights before the Covid-19 outbreak,” he said.

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