In this column, I would like to introduce Phnom Penh focusing on the 3 categoriesbelow.

1. Phnom Penh's land ruled by One Belt & One Road Initiative! The city of China Town
2. A peek into the major commercial areas of Phnom Penh – Korea or Phnom Penh?
3. Expansion of Phnom Penh in all directions – war of the malls


Before I begin, I would like to briefly explain different zones in the city. As of now, Google map divides Phnom Penh into 22 districts. Please refer to the table below for a simple district map and details for each district.

 As you can see from the table above, Phnom Penh is divided into small districts and all of the 22 districts are currently going through a wave of development. The main developer is China. Cambodia is one of the key countries in China's "One Belt & One Road initiative" and is now witnessing a huge influx of capital into the country. It is not an exaggeration to call large cities such as Phnom Penh/Sihanoukville/Battambang as the cities of China Town, meaning that the capital from China has encroached on the majority of the streets in these cities. The capital influx for investment from China to Cambodia increased 5 times from $260 million in 2012 to $1,450million in 2017 with China aggressively investing in all sectors including infrastructure (new airport), construction, and manufacturing. Along with the money comes people. In 2017, 160,000 Chinese entered Cambodia for business or to stay, which is a 2.5-fold increase compared to 2014. The inbound Chinese travelers visiting Vietnam not for business but for tourism has also exceeded 1 million. We cannot even talk about Phnom Penh without talking about China.

 I would like to introduce No. 7 (Tonle Bassac) through No. 13 (SenSoc) in the above map as the major commercial areas of Phnom Penh, the city of Small China. These areas are also the most important key commercial districts for cosmetics sales in Phnom Penh. The first district is Tonle Bassac where AEON Mall 1, the city's representative shopping mall, and Naga World Hotel, famous for its casino, are located in. It is a popular region for travelers because of its proximity to Mekong River and many Chinese tourists enjoy casino at Naga World and shopping at its underground duty free shop. When you visit Naga World, you may not know whether you are in China or Cambodia as it is always packed with Chinese. AEON Mall 1, first opened in 2014 by Japan's AEON Group, has been greatly influential in the local market since the opening as the game changer in shopping in Phnom Penh. It is positioning itself as a multi-purpose space that offers cinema, games, bowling alley and other recreational activities. Over 20 multinational cosmetics brands have stores in AEON Mall 1 including Japan's Shiseido, global brands such as LORE'AL Paris and Revlon as well as Korean brands such as LG WHOO&O Hui, The Face Shop and Nature Republic. AEON Mall itself is a trusted brand among Cambodian consumers. Cosmetics brands that have stores in AEON Mall are considered trustworthy among the locals.

 Also, pubs and clubs are concentrated around Bassac Lane in this district and many young Cambodians come here for fun Friday nights or golden Saturdays. Due to the relatively high price range compared to the local consumer price, upper-class Cambodians and tourists are the main customers.

 The next commercial area I want to introduce is ②Boeung Keng Kang 1~3 districts, commonly referred to as BKK.

 This area is the Gangnam of Phnom Penh. Surrounding the independence monument as the center, boutique hotels, luxury restaurants and global coffee franchise shops such as Starbucks and Coffee Beans are all concentrated in this region to attract foreign tourists. It is a tourist attraction, but also de facto No.1 commercial district of Phnom Penh where all office buildings and stores of popular global and local brands are concentrated around Monivong Blvd and Sihanoukville Street. For reference, BKK was the first region developed as a commercial area after Cambodia opened up for westernization. Therefore, this area is already fully saturated. Even the store rent can be twice as expensive as other regions just like Gangnam in Korea.

 The average rent in this region ranges between $1,500 and $1,800 for 30 pyeong. ($600~$800 in Toul Tom Pong, a nearby commercial area for the same size). As a result, small alleys are turning into commercial spaces here. For beauty stores, this district is full of brand shops (including flagship stores), drug stores and luxurious beauty clinics and beauty salons. As the major customers are upper-class locals and foreigners, the shops here mostly sell expensive products or offer high-end skincare and makeup services.
(For makeup services, the average price per session is $3. The price per session differs from $1 to $10 depending on salon and artist)

 The third district to introduce is ③ToulKok. This region is akin to the combination of Cheongdam-dong and Pyeongchang-dong. The highest-class Cambodians such as the government officers and large business owners live here as it is a residential and commercial area filled with luxurious mansions and high-rise apartments>. There is also a famous shopping street called TK AVENUE in this district that has famous local brand stores including Legend Cinema and Brown Coffee and popular global brand shops including Starbuck, Shiseido and Adidas. For beauty shops, high-end spa shops and beauty clinics are on this street similar to BKK, and some Korean brand shops (TonyMoly) and individual shops are also situated in this streets to sell Korean products.

 So far, I have introduced 3 key commercial areas in the city, and now I would like to introduce rising commercial regions – SenSock and Koh Pich. SenSock is now witnessing a rapid increase in visitors and influx of people with the opening of AEON Mall2 in May this year. Other large-scale shopping malls such as The Premium Land and Borey (house village) are under construction now. This area is like to grow into a multi-purpose commercial zone for both residential and commercial area. The region is rising because it has reflected the needs of the customers in Phnom Penh's northwest region which is a little far from the existing AEON Mall1 in the northeast of the city. Koh Pich (aka Diamond Island) is a special commercial area different from other regions. Koh Pich is a special autonomous district developed by Canadia Group (private financial corporate) based on the land rented from the government for 50 years. Thanks to the geographical benefits (close to Mekong River, Tonle Bssac and BKK), new construction of super high-rise multi-purpose buildings (45-story The Bridge, etc.) and construction of SOC (well-organized roads and European-style buildings, etc.), this region is highly like to become the key tourist attraction and commercial area in the future.

 In addition to these regions, the construction of Cambodia's first department store, Parkson Mall, is close to the completion. Parkson Mall is to be open in ToulKok district, targeting not just the upper-class locals in the neighboring area but also the residents of a newly built Borey in the west of Phnom Penh. AEON also recently announced its plan to build AEON Mall3 after the successful launch of the second mall in Borey Pinhup Thmey region near Hu Sen Blvd (the largest and the most well-organized road, 60 meter in width and 10km in length) in the south of Phnom Penh. Phnom Penh Post recently published that the number of newly opening shopping malls in 2018 alone is estimated to be 12. I believe war of the malls has begun in the city to encourage the increasing number of Chinese tourists and the locals who are now starting to enjoy consumption thanks to the growing economic power and mobile phones to spend more and more.

 Who will be the winner of this war, and what new commercial areas will arise?
I will be coming back to Phnom Penh for sure just to see the change.

 Thank you.