Royal Group, the owner of Cambodia’s largest mobile phone operator, has entered into a joint venture with Hong Kong-based Millenium Group to raise up to $2 billion (€1.26 billion) to develop properties on an island in Cambodia, according to a report by Bloomberg.
The two companies are currently seeking institutional investors for the fund, which is reportedly looking to develop resorts, apartments, golf courses, casinos and an airport on Koh Rong island, off the coast of the southern port city Sihanoukville. Royal Group has a 99-year lease to the island.
Cambodia is slowly attracting real estate investment capital as it becomes more popular with tourists. The country has recently opened its first stock exchange, and has seen rapid economic growth over the past few years. It has also seen relative political stability and an improving legal framework. It is a significant exporter of soft commodities and food products and holds the potential to being an attractive tourist destination because of its climate. As more firms enter Vietnam, the more adventurous are turning their attention to Cambodia, where there are still few investors.
Millennium is not the first Hong Kong group to show an interest in Cambodia. In May, Hong Kong-based private equity firm Leopard Capital held a first close on its $100 million Cambodia private equity and real estate fund, expecting to see its final close in March of next year.
Established in 1999, Millennium partners with pension funds, private equity funds, investment banks, developers, corporations, governments, trusts and high net worth individuals to invest its capital in Asian property.