Singapore-based property developer Sir Stamford Raffles Group (SSRG) is betting on Cambodia’s projected economic growth led by a new administration.

SSRG has committed approximately $300m to building a 22.6-hectare freehold township, a short drive away from the new international airport that is under construction in the capital Phnom Penh.

fDi Intelligence sat down with SSRG co-founder Phebe Len to discuss the development project.

Q: What made you decide to invest in Cambodia?

A: We have done our fair share of feasibility studies and we recognised that there is a steady growth in GDP. In 2024, growth is targeted for 6.6%. At the same time, there was a lot of very proactive and aggressive development in terms of national infrastructure making Cambodia a more conducive bedrock for foreign investors like ourselves.

The real estate market is also less saturated than in, for example, Vietnam or Thailand. The country also has no capital restrictions and is a dollar-based economy.

Q: In August 2023, Cambodia voted in a new prime minister. Not even a year in power, how is the new administration shaking up the FDI landscape?

A: With the predecessor it used to be a rectangular strategy. With the new prime minister, it’s the pentagonal strategy. So the new administration is focusing on five development factors: roads and infrastructure; water; healthcare; electricity and technology; and climate. 

But compared to the previous administration, the current prime minister is focusing on people first. That means he sees a great need to enhance the skill sets of the people and encourage FDI to engage and employ the people of Cambodia. The previous administration did seek to develop the labour force but it wasn’t as much of a priority as in the current leadership.

Q: What challenges do you foresee for Cambodia’s FDI landscape in the coming year?

A: Investors will still be grappling with access to more legal advice. When you navigate in Cambodia you have to do plenty of due diligence on your own. You have to rely on several advisors to establish a certain consistency and pattern. 

It’s not because Cambodia is quite corrupt but rather that its legal frameworks are still growing. It’s a legacy issue because in the past there wasn’t a lot of record-keeping. For example, if you want to buy a piece of land, you would want to know who were the owners and how was that land acquired, but there’s no proper documentation that we can fall back on. Proper record-keeping will help investors make better-informed decisions.

Q: In February this year, you announced your project to build a township just outside the capital Phnom Penh. What is this project about?

A: Our project is a township development. It covers more than 22.6 hectares and we selected the development site ourselves after conducting significant feasibility studies. Our studies showed that Kandal Province is the next commercial destination, very much affected by the new airport only a 30-minute drive from us.

When there is such a super infrastructure like an airport everything else will follow, such as highway connectivity in and out of a city. So we are kind of smack in the middle of that area.

The proximity to the airport is also a big booster for our development because we’re not building houses per se. We’re building a township leveraging the fact that the airport will spawn a commercial and logistic hub as well as residential departments.

For our development, we chose to put the majority of land plots into creating single villas, because everybody’s dream is to own your own house. So the houses may be a bit smaller than a typical king or queen villa. But there’s a size and affordability for everyone in the way that we designed it.

Q: Cambodia often ranks quite high on several corruption indexes. How has this affected the firm’s operations there? 

A: It didn’t. If anything, the banks and legal advisors really pushed us to go through the proper channels when we faced challenges. There’s no real shortcut, but there is also plenty of room to put in an appeal and I think it is encouraging because it is a two-way understanding. 

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This article first appeared in the April/May 2024 print edition of fDi Intelligence.