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Home Industries Construction & Maintenance

Construction & Maintenance

Here’s a summary of the country’s construction market and the types of companies operating; including contractors, suppliers, maintenance firms and so forth.

As a continually evolving industry, construction is playing an increasingly strong role in Cambodia’s economy. We take a look at the developments that look set to change the capital’s landscape. Get some top tips from our panel of industry insiders on how to successfully carry out construction projects, make the most out of your team and hire the correct workers.

If you can’t find you’re answer here, just ask us at B2B and we’ll point you in the right direction.

  • A construction boom has taken hold of the Cambodian capital, with a range of commercial and residential projects springing up across Phnom Penh at a growing rate.
  • According to the latest figures from the Ministry of Land Management, Urban Planning and Construction (MLMUPC), the number of construction projects approved in Cambodia during the first half of 2017 increased 28 percent compared with the same period last year, amounting to a total value of around $4.9 billion.
  • As per MLMUPC’s figures, the government approved 1,523 projects nationwide between January and the end of June 2017, compared with 1,183 projects for the first half of last year.
  • These projects are getting bigger in scale.  Affordable housing projects, condominiums, hotels, lifestyle malls and office buildings are the trend.
  • According to CBRE’s latest available report, the capital is set to welcome a significant wave of new condominium supply over the course of 2017, with nearly 7,000 units due to be delivered by the end of the year. CBRE expects to see the completion of more than 1,500 condo units before the end of the year’s second quarter.
  • Cambodia’s investment in the real estate and construction sector in 2016 capped off at $8.53 billion, a 155.7 percent increase compared to the same period in 2015, according to the Phnom Penh Post.
  • Cambodia’s FDI totalled US$2.15 billion in 2016, a 25% increase from the year prior. The top three recipient sectors for foreign investment are banking, manufacturing and real estate.
  • Nationwide, investment into approved construction projects reached $8.5 billion across 2,636 projects by the end of 2016, an increase of 143% on 2015, which saw $3.5 billion invested in 2,305 projects.
  • China remains the country’s largest source of FDI. During October last year, a visit by Chinese President Xi Jinping resulted in the agreement of almost US$2 billion of infrastructure investment and aid to the country, including a $1.9 billion highway project linking Phnom Penh and the port city of Sihanoukville.
  • Developments underway include ING City, Koh Pich and Exchange Square.
  • Some projects recently concluded are The Bridge and Borey 999.
  • Cambodia’s first shopping mall opened its doors in the capital in June 2014 in the form of Aeon Mall. Its success helped pave the way for similar projects. A second giant Aeon mall will open its doors in Phnom Penh in 2018 in Tuol Kork. Other ambitious retail developments are Parkson Mall, Olympia Plaza and The Bridge, all of which are expected to be finished soon.
  • The $120 million Sokha Hotel and Residence on Phnom Penh’s Chroy Changva peninsula officially opened in March 2015.
  • A draft for a new construction law is currently being considered
  • The key building law currently in place is the Law of Management and Planning of Urban Construction (1994).
  • Obtaining construction approvals for large-scale projects can be time consuming with the average request for approval taking one year to process. Total building permit fees are in the region of $6,000-7,000.
  • Generally speaking, the cost of construction in Cambodia is approximately 10 percent higher than neighbouring Thailand and Vietnam, due to a dependence on imported materials. In a country with particularly high costs for electricity, people are increasingly incorporating renewable energy solutions into building projects, particularly solar and wind.
  • CAMBUILD continues to be the biggest forum for the construction industry. The 2017 edition of the expo, held in September, was based around the theme of quality—in construction and in materials—and eco-friendly designs.
  • As more foreigners move to the country and development continues to pick up pace, the standards and quality of construction have also risen.
  • A draft for a new construction law is currently being considered
  • The key building law currently in place is the Law of Management and Planning of Urban Construction (1994).
  • Until now, international developers have been bringing their own standards of construction practice to projects inside Cambodia.
  • The Government is currently consulting with industry and private sector.
  • 193 construction projects were found to be building without permits in 2014.
  • Obtaining materials for their projects is still a challenge for construction companies and architecture and interior design firms. Currently, the country lacks a one-stop shop for construction materials, and companies are forced to visit different parts of the city to gather materials. Many high-end materials need to be imported—which bumps up prices significantly—with Cambodia lacking manufacturers that specialise in more exclusive products.
  • Health and safety standards are a continuing issue in Cambodia, with many construction sites failing to adhere to even the most basic of standards.
  • Pending regulation and compliance updates, health and safety remains the responsibility of the construction company.
  • This means comprehensive training and education must be done, along with on-site monitoring to ensure these standards are followed.
  • International accreditation bodies accredit some firms, which means if you look for a Cambodian constructor that has international accreditation, it has demonstrated that it can ensure consistent and proper management of health and safety risks in the workplace and are aligned to internationally recognised best practice.
  • For instance, the “Occupational Health & Safety Advisory Services (OHSAS)” certification lasts a period of three years, and is managed by BM TRADA, a UK-based international independent certification provider.
  • In recent years, the Cambodian construction industry has been stretched by the strong need for manual labour.
  • This is due to a number of factors, such as the spike in construction projects nationally, a rise in Cambodian workers migrating to neighbouring countries seeking higher pay, and an increase in Cambodians choosing to pursue more highly-regarded careers.
  • Thailand, for example, has always been an alluring prospect for skilled Cambodian construction workers, and ASEAN is only likely to increase this drive.
  • However, it appears that there is a common shortage now: Myanmar has a labour shortage, Laos has a labour shortage, and Thailand has a big labour shortage.
  • Ultimately though, the cost of construction will have to rise significantly, because of the increasing costs of labour.
  • Incentive schemes and out-pricing the competition in terms of wages helps, but still staff might move for a small difference in finances, and understandably so: In many more-developed countries, the biggest cost of construction is generally labour. Here in Cambodia it’s a much smaller percentage.
  • This has also led to a lack of specialised skilled labourers.
  • Certified tradesmen such as electricians, plumbers and welders are quite hard to come by in Cambodia and standards are often lower than in more developed countries.
  • Such concerns, of course, should be balanced against the low salaries for which labourers work.
  • There is a distinct lack of vocational training options provided by the Government, so it remains the responsibility of the private sector to train, and retrain.
  • Upskilling is made easy with a variety of vocational training for new employees.
  • Offering training up to company standards is something many larger companies carry out already, and this trend is growing fast.
  • However, smaller companies may not budget for this.
  • Certain NGOs run vocational training for things like welding and mechanics.
  • PSE, Child Fund, Friends International and Indochina Starfish Foundation are a few that offer vocational training courses.
  • The Lighthouse Club also offers various scholarships.
  • Some companies bring in interns to test their aptitude before hiring.
  • Experts agree construction is going to continue to play a major role in Cambodia’s economy well into the future.
  • International developers will keep pouring into the country, while local construction and architecture companies will also keep on multiplying.
  • We can expect the number of showrooms to grow exponentially.
  • As the number of high end projects increases, experts agree the availability of quality materials will also improve, with more manufacturers rushing to feel the current gap.
  • We can also expect a rise in the number of eco-friendly designs.

Construction Top Tips

Here we call on our panel of experts to share what they have learnt about the construction and maintenance industry in Cambodia.

  • Being clear and concise with your vision can go a long way in Cambodia.
  • Being clear with your expectations and explaining exactly what you want can save time in the long run.
  • Plan ahead, buy ahead and have things ready on site for the contractors so that measurements and the small details can be concentrated on.
  • With standards varying massively when it comes to construction quality and delivery, when it comes to choosing a contractor, doing your research will undoubtedly pay off.
  • The same applies when on the hunt for materials and tools, with several products potentially needing to be imported.
  • Often more high-end or unique products have to be bought from abroad.
  • Despite the enforcement of health and safety laws and rules and regulations being lax in Cambodia, there are firms that adhere to the standards practised in more developed countries.
  • There are lots of health and safety issues in Cambodia so the requirements vary greatly. This can add to the cost, for example, when using the correct scaffolding.

People and Labour in Cambodian Construction

If you want to build in Cambodia the first thing you will need are skilled human resources.
Get the latest on the People and Labour market in Cambodian constructions and maintenance below.

  • The recent decline in the number of available labourers in Cambodia has also triggered a downturn in skilled construction workers.
  • In recent years, fears have been raised that the sector faced a huge labour shortage because of the boom in projects across the country as well as a rise in workers migrating to Thailand in search of higher paid work.
  • This has led to a lack of specialised skilled labourers, though NGOs such as Friends and PSE have developed programmes to provide skilled workers to the industry.
  • Certified tradesmen such as electricians, plumbers and welders are quite hard to come by in Cambodia and standards are often lower than in more developed countries.
  • However, standards of workmanship, though continuously improving, are generally lower than in western countries, and an inability to communicate effectively in English can be a challenge for non-Khmer speaking customers.
  • Such concerns, of course, should be balanced against the low salaries for which labourers work, although ensuring work is done to an acceptable standard may require continuous attention.
  • Another common problem businesses often run into is the culture clash that can occur due to local attitudes towards deadlines and, at times, standards when compared to some Western countries.
  • Constant supervision of the “local crew” is common in Cambodia and the rest of Asia.
  • Offering training up to company standards is another option, which many larger companies carry out.
  • Hiring English-speaking workers or someone who can coordinate the activities of your labourers is to a great extent a question of whether you personally have the time and experience to provide guidance to the crew.
  • As a foreigner, finding a basic construction job is fairly unlikely as most of these jobs will go to locals given their considerably lower salary requirements.
  • Positions that require longer experience and higher education such as architects and engineers, or those directing the construction projects, are most likely to be filled by foreigners, though there is an ever-growing number of Cambodians with international experience.
  • The business of building in Cambodia involves many groups of people and one can set up at any point in the chain. Many will even tell you there is not one path to realising a project, particularly with some companies acting as developers.
  • Developers can also take on the role of instigator to contractor, as they may be the ones who have a project in mind or will work for a client to bring the client’s project to life.
  • Some developers claim to “do everything but the construction,” and they will help with sourcing materials, hiring contractors and architects, purchasing or leasing a site and securing funding, not to mention conducting a feasibility study and market research.
  • Firms in Cambodia operate in a number of ways – as contractors and construction companies or developers. For larger building projects, even those granted by the government, foreign firms are often the main contractors.
  • This is true for infrastructure projects like the railroad rehabilitation, dams and other major civil engineering projects. Phnom Penh’s biggest towers are all being or have been built by foreign firms.
  • That is not to say that Cambodian firms don’t take part in the construction and development of the country.
  • Many of these firms are subcontractors, which do the vast majority of the work on any project, working with the contractor rather than interfacing directly with client.
  • As Phnom Penh continues to boom, space is rapidly running out in the capital. This has made it increasingly difficult to find premises fit for a business’s needs.
  • As more international architects arrive in the city, the creativity when it comes to designs is growing.
  • Local architecture and interior design firm are also rapidly growing in number, offering reliable and affordable services, and providing a platform for local young professionals to develop professionally. Re-Edge Architecture & Design, for example, recently completed the design of boutique hotel Lumiere.
  • Businesses moving to Cambodia often have grand plans of transforming dilapidated buildings into new ventures, such as bars, hotels and restaurants, or even creating their own office space with a Western finish.
  • The country now offers a range of services to help businesses create the ideal space to work in.
  • However, restrictively short leases are often offered to foreign businesses. This creates impediments to renovations.
  • The quality, choice and style of architects and engineers – especially structural – is constantly improving.
  • A lot of the older buildings in Phnom Penh are from the 60s, and they’re now at the end of their life. Their design life was only 30 to 40 years and now they’re showing signs of collapse at some point.
  • This is why it’s vital to recruit the expertise of good engineers when carrying out renovation or construction work.
  • There are good engineers around, however, there’s also a lot of average ones.
  • When it comes to choosing an architect or interior designer to help revamp or create a workspace, don’t focus solely on budget. You get what you pay for and it’s important to remember this – especially if poor quality work will lead to a direct danger to your safety.
  • Many companies in the country specialise in a particular aspect of construction, such as security, electricity, IT, infrastructure and plumbing.
  • Most developers will call upon specialty services for their particular construction needs to ensure the work is done right the first time. An increasing number of firms will specialise in specific types of projects.
  • In particular, restaurants, bars and hotels have in recent years become big business for many foreigners, and several now provide high quality construction and design solutions.
  • Some offer a turnkey solution to starting such a business so that everything is handled for the owner from finding and leasing the property, to construction, business registration and hiring staff.
  • There is currently a push for more internal industry to develop. Some services, such as the supply, installation and maintenance of solar energy systems, for example, have been successfully operated by locally owned and managed companies for many years.
  • Construction firms in Cambodia operate in a number of ways—as contractors, construction companies or developers.
  • For larger projects, even those granted by the government, foreign firms are often the main contractors.
  • This is also true for infrastructure projects like the railroad rehabilitation, dams and other major civil engineering projects.
  • Phnom Penh’s biggest towers are all being or have been built by foreign firms.
  • That is not to say that Cambodian firms don’t take part in the construction and development of the country. Many of these firms are subcontractors, which do the vast majority of the work on any project, working with the contractor rather than interfacing directly with client.
  • An increasing number of firms in the country specialise in a particular aspect of construction, such as security, electricity, IT, infrastructure or plumbing.
  • Most developers will call upon specialty services for their particular construction needs to ensure the work is done right the first time.
  • Ensure you do a lot of site visits during the construction process to make sure that all contractors are following the plan properly. When working with some local contractors, it might pay to make the design simpler than you might in other countries. However, this should ensure it will be able to be done well.
  • It is also important make sure that the materials required by the design are easily available.
  • Always do your due diligence on any subcontractors and, remember, in Cambodia you get what you pay for.
  • It hard to find capable engineers to maintain buildings, given the difficulty in finding local workers with the necessary qualifications and experience required when maintaining a building.
  • Given the substantial differences in salaries for foreigners and locals, it doesn’t make financial sense to employ a foreigner with the necessary skills if a local can do the job just as well, especially if the foreigner is unable to speak Khmer.
  • Some businesses have worked for years to train up their staff while others will turn to local service providers as needed for individual developments.
  • That said, systems such as a building’s electrical wirings have often been poorly installed in the first place, in which case more than mere regular maintenance is necessary, with a complete rewiring job often being required.

Bits and Pieces

Here’s where to find all your necessary construction materials, supplies and equipment for any Cambodian construction projects.

  • With construction being one of the country’s main industries, basic building materials are readily available. But for specialist or specially-designed products, importing is still the only way.
  • In general, building materials such as bricks and concrete are cheap and used extensively across Cambodia.
  • However, if it’s a modern Western style that you are after, then importing is almost the only way despite a rise in choice.
  • And the same can be said if Western standard construction is what you’re after.
  • Anything semi high-end may need to be imported – and then you don’t know whether it’s going to take one month or three months, or whether or not it’s going to get stuck in customs.
  • Because the majority of materials are imported, the price is driven up.
  • But most can be sourced from Thailand, Malaysia or Singapore.
  • Most equipment that you would expect to find is available in Cambodia as suppliers, retailers and service companies have entered the market with the growing development taking place.
  • Many of the major brands and equipment can be found and specialised equipment is easily imported, so virtually any project is theoretically possible.
  • However, logistics in Cambodia is a challenge because of small roads especially in rural areas.
  • No additional licenses are required for large equipment such as cement trucks, cranes or bulldozers.
  • Often the operator owns the equipment though there are companies who lease it as well. Just as there is no need for any special licensing for the equipment, there is rarely a need to seek permission for the use of heavy equipment, even in urban areas.
  • This may change as the Phnom Penh municipality in particular has begun to put restrictions on trucking through the city streets but, given planning and construction permission, you should have no problems.
  • Generators are often necessary for construction projects and are commonly part of the design of newer buildings as Cambodia still suffers from regular power outages, especially during the hotter months of April and May when demand for electricity regularly outstrips the available supply.
  • Some renewables services, such as the supply, installation and maintenance of solar energy systems, have been successfully operated by locally owned and managed construction companies for several years.
  • Companies are increasingly looking at options for renewable energies, especially solar and wind, and any way that renewables can be involved in mainstream construction projects, and also how building design can become more energy efficient.
  • Cambodia is a great market for solar energy: it has 5.8 peak sunlight hours a day, one of the best solar resources in the entire region.
  • Arguably, Cambodia’s potential in solar is not being met, however. To date, the bulk of solar panels installed in the Kingdom belong to small solar home systems (SHS) built on households in the countryside. Only a handful of larger solar energy ventures have been undertaken or are planned, all of them having been announced within the last two years.
  • According to a recent report by the Mekong Strategic Partners (MSP) titled Switching On: Cambodia’s Path to Sustainable Energy Security, the costs associated with solar power are falling rapidly, so much so that Cambodia can now, according to the study, cost-effectively strengthen its energy security by accelerating investment in solar and biomass technologies.
  • According to the MSP report, solar installations above one megawatt can now provide electricity profitably for as low as 12 cents/kWh, which makes it “the most competitively priced alternative renewable energy technology”.
  • Various lobby groups are in discussion and the support for this innovation is growing.
  • More and more options are available.
  • This is a good step for a country like Cambodia with clear limitations in regards to domestically available energy.
  • However, many of these improvements we are experiencing are client-driven.
  • Many new and proposed developments include energy efficient measures, such as ground source cooling and nanoleaf lightbulbs.
  • The new Aeon Mall project also incorporates solar panels into the design.
  • The new Coca-Cola plant in the Phnom Penh Special Economic Zone has a photovoltaic (PV) system in the rooftop that will eventually supply a third of the factory’s electrical energy needs, while Khmer Beverages recently installed 10,000 panels to help power its beer factory.
  • High-end residential building Silvertown Metropolitan has a PV panel installation that will eventually supply 12 percent of its energy needs.
  • Products such as the nanoleaf lightbulb are also entering the market at a reasonable price.
  • Other measures, such as double-glazed windows are available and by investing in eco-friendly initiatives such as this, businesses can save up to 40% off their energy bill.

Registration and Regulations

Here’s all you need to know about current regulatory standards and registration expectations for any new construction projects in Cambodia.

  • The Cambodian Ministry of Urban Planning, Construction and Land Management is ultimately responsible for the issuance of construction permits, planning and licensing.
  • The head office is on Monivong Boulevard, Phnom Penh, with regional offices in provincial centres.
  • Unlike western and some neighbouring countries, planning permission isn’t strictly enforced and zoning is rarely an issue.
  • Yes. The Ministry of Urban Planning, Construction and Land is ultimately responsible for the issuance of construction permits, planning and licensing.
  • The head office is on Monivong Boulevard, Phnom Penh, with regional offices in provincial centres.
  • Take note that unlike Western and some neighbouring countries, planning permission isn’t always strictly enforced in Cambodia and zoning is rarely an issue.
  • The construction of new buildings, and renovation of existing structures involving a substantial degree of remodelling, for residential or commercial purposes, requires prior approval from the Ministry of Land Management, Urban Planning & Construction in the form of a permit.
  • In the city areas the permit should be signed by a government official, usually someone at district (khan) or commune (sangkat) level, whereas in provincial areas permission should be sought from the provincial governor.
  • Commercial buildings larger than 3,000 square metres will also require approval at ministerial level, as do certain projects under consideration by the Council of Ministers or the CDC (Council for the Development of Cambodia).
  • Some projects in Siem Reap are regulated by the Apsara Authority, who hold the exclusive right to grant permits in the Angkor site.
  • To apply for a permit, the construction or renovation plans, drawn up by an architect with recognised qualifications, should be submitted to the relevant authority by the owner of the land or building, or his authorised representative.
  • The plans must be accompanied by the relevant application documents completed in Khmer. In the case of industrial buildings, information should also be attached detailing how any environmental issues will be handled.
  • Fees vary according to the size of the project, but a small renovation project authorised at communal level will typically cost from $1-300, and up to $1000 for projects requiring permission from district level.
  • Major projects requiring ministerial approval will of course be more expensive.
  • The office has 45 days in which to approve (or disallow) the project, and construction must begin within one year of the approval being granted, though one extension is generally allowed.
  • Following the completion of the construction project, and (in the case of a public building) prior to the building being opened to the public, the project must be approved by means of a certificate to demonstrate that the construction was successfully accomplished in accordance with the approved plans.
  • As more foreigners move to the country and development continues to pick up pace, the standards and quality of construction have also risen.
  • A draft for a new construction law is currently being considered
  • The key building law currently in place is the Law of Management and Planning of Urban Construction (1994).
  • Until now, international developers have been bringing their own standards of construction practice to projects inside Cambodia.
  • One issue with using local Cambodian companies is the lack of standards and regulations.
  • There are numerous Cambodians who can provide services at a lower price but may lack the training of a certified electrician or plumber.
  • Ensuring a proper working infrastructure will enable your building to operate to its fullest capability and getting repairs done in a timely fashion is always important.
  • The Cambodian government is in the process of setting up standards for MEP and construction, though currently most people follow French, Australian, British or American standards.
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