Phnom Penh Construction Activity Plummets: New APS Report Highlights 71% Drop

New high-rise construction projects in Phnom Penh experienced a dramatic decline in 2026, with a reported 71% drop compared to the previous year, according to the Green Net 2026 Report published by APS Cambodia. The report, which tracks development activity across the capital, noted that only 22 new projects were initiated this year, down from 76 in 2025.

The survey, conducted from September 15 to October 22, 2026, monitored a total of 273 construction projects. While the number of new projects fell sharply, the overall number of tracked projects saw a slight increase of 6% year-on-year, reaching 389 when including those completed in 2025. However, the report cautioned that the decline in new starts could lead to a tapering of project completions in the coming years.

APS reported that projects currently under construction dropped by 37% to 98, while completed projects fell by 49% to 59. Notably, the number of projects reaching practical completion increased by 56% to 25, and those in the fitting-out stage rose significantly from seven in 2025 to 54. This indicates that while fewer projects are starting, those that were already underway are progressing towards completion.

“Projects that were structurally underway last year are moving toward completion, but with fewer new projects starting, completions could taper in the coming years.”APS Report, Green Net 2026

Moreover, the report highlighted a 4% increase in projects that are currently on hold, totaling 79, with 44 of these having been inactive for at least two years. Interestingly, 28 projects that were previously on hold resumed construction, but 35 projects that had been under construction in 2025 were newly put on hold, suggesting a growing backlog of inactive projects.

APS noted that the Boeng Keng Kang area had the highest concentration of tracked projects, with 45, followed by Daun Penh with 43 and Sen Sok with 34. Development activity has also been observed in peripheral districts, particularly in the south, while new projects in the city center are becoming increasingly limited.

“The oversupply of high-end and landed properties has pressured property prices, leading to increased discounts from developers.”Ministry of Land Management, Urban Planning, and Construction

Condominiums accounted for the largest share of tracked projects, representing 24% of the total with 65 projects. Mixed-use developments followed with 51 projects, while apartments and hotels made up 44 projects. APS emphasized that the Green Net report is a directional survey and does not provide a complete count of all construction activities in Phnom Penh, as projects completed before September 2026 and those started after October were excluded from the survey.

This downturn in construction activity reflects broader challenges in Cambodia's real estate sector, which has been grappling with excess supply and low demand since late 2022. According to the Ministry of Land Management, Urban Planning, and Construction, total investment in real estate and construction projects fell to USD 2.97 billion in 2022, down from USD 7.75 billion in 2020 and USD 5.33 billion in 2021. The oversupply of high-end and landed properties, stemming from a construction boom in 2019-2020, has further pressured property prices, leading to increased discounts from developers in 2023.

As the market continues to adjust, the rise of shadow banking activities poses additional risks, with many developers relying on high-interest instalment plans from buyers rather than traditional bank loans. This reliance has led to disputes between developers and homebuyers, particularly as some projects have stalled due to financial difficulties.