Real Estate

Highlights
2nd Half 2024 A comprehensive analysis of Malaysia’s industrial, office, knightfrank.com.my/research
retail, hospitality and residential markets
 MALAYSIAN
ECONOMIC
OVERVIEW

Contents
2
Communication Technology (ICT) Financial flows presented a mixed Investments in technology include
and electrical and electronics (E&E) picture, with net outflows in direct RM10 million for the National Artificial Market Highlights
manufacturing. Meanwhile, public investment balanced by strong foreign Intelligence Office (NAIO) and RM50
investments prioritised large-scale direct investment inflows. In the million for AI education.
infrastructure projects, including the first nine months of 2024, Malaysia

8
Pan Borneo Highway and East Coast secured RM254.7 billion in approved Malaysia’s economic outlook for 2025
Rail Link (ECRL). investments across services, points to steady growth and resilience, Industrial Market
manufacturing and primary sectors, a with GDP expected to expand by 4.5%
Economic activity was led by the 10.7% increase compared to the same to 5.5%. Household spending will
services and manufacturing sectors, period in 2023. These investments, continue to play a key role, driven by
with manufacturing benefiting
from export-oriented production
comprising 4,753 projects, are
expected to generate approximately
wage growth and targeted measures,
while private and public investments 20 Office Market
and the global technology cycle. 159,000 new jobs. are projected to grow by 12.1% and
The construction sector posted a 7.7% respectively, supported by multi-
significant 19.9% growth, driven Budget 2025, unveiled by Prime year projects under the NETR and the
by residential, non-residential and
specialised trade projects. Conversely,
Minister Datuk Seri Anwar Ibrahim,
emphasises economic growth,
New Industrial Master Plan 2030.
28 Retail Market
the mining sector experienced a fiscal reforms and public welfare. Exports are forecasted to grow by
decline due to maintenance activities, With an allocation of RM421 billion, 5.1%, driven by demand for E&E

36
In the third quarter of 2024, Malaysia’s while agriculture saw modest gains, it prioritises development projects products and a stronger tourism
economy demonstrated resilience, primarily from palm oil output. in education, healthcare and sector. Imports are expected to rise at Hospitality Market
achieving a gross domestic product infrastructure, dedicating RM86 billion a slightly lower rate of 4.4%, reflecting
(GDP) growth of 5.3% year-on-year External trade contributed positively, to these areas. Key fiscal reforms demand for capital goods.
(y-o-y). This growth was driven by with exports rising by 11.8%, supported include an expanded scope of the
strong private expenditure, recovering
exports and heightened investment
activities. Household spending
by demand for E&E products and
recovering tourism. Imports grew by
13.5%, reflecting strong demand for
Sales and Service Tax (SST),
a 2% tax on dividend incomes above
RM100,000 and targeted subsidy
Inflation is anticipated to moderate
between 2.0% and 3.0%, with
unemployment remaining low at 3.1%.
44 Residential Market
remained a key driver, supported by intermediate and capital goods. rationalisation for RON95 petrol Fiscal consolidation aims to reduce
favourable labour market conditions and diesel. the deficit to 3.8% of GDP, while
and targeted policy measures. Inflationary pressures were well- accommodative monetary policies will
Employment gains and an increased contained, with headline and core Social welfare initiatives feature a continue to support growth.
minimum wage further boosted inflation remaining steady at 1.9%, minimum wage increase to RM1,700
consumer demand. supported by effective monetary effective February 2025, alongside By fostering innovation, improving
policy. The overnight policy rate enhanced tax reliefs for education fiscal efficiency and promoting
Investment activity remained (OPR) was maintained at 3.0% to and healthcare. Sustainability sustainable development, Malaysia
dynamic, with contributions from sustain economic momentum. The measures are supported by RM300 is well-positioned for long-term
both private and public sectors. ringgit strengthened against the U.S. million under the National Energy economic growth and enhanced well-
The private sector concentrated on dollar, supported by narrowing interest Transition Roadmap (NETR) and the being for its citizens.
high-tech and knowledge-intensive rate differentials and improved introduction of a carbon tax targeting
subsectors, such as Information and investor confidence. high-emission industries by 2026.

1
 KLANG VALLEY
Industrial Mall highlight a shift toward neighborhood-centric,
• The industrial sector is experiencing growing interest in community-focused retail spaces.
smart and sustainable facilities as businesses prioritise • Major acquisitions, including Tropicana Gardens

MARKET
efficiency and reducing environmental impact. In Mall, DPulze Shopping Gallery and 163 Retail Park,
response to this trend, landlords are redeveloping older demonstrate robust investor confidence in high-quality,
factories and warehouses into modern, high-grade strategically located assets.
facilities. Sustainability and innovation have become • Retailers are adopting experiential and technology-
critical considerations in these projects, aligning driven concepts to attract consumers and maintain

HIGHLIGHTS
industrial spaces with evolving tenant demands. competitiveness in the evolving market landscape.
• Industrial Real Estate Investment Trusts (REITs) are • Government household-centric policies are expected
demonstrating strong confidence in the sector’s growth to support spending on essentials, but SST expansion
potential, actively acquiring assets to capitalise on and fuel subsidy rationalisation may influence demand
emerging opportunities. This momentum is expected patterns and increase costs.
to persist, driven by REITs leveraging innovative asset
strategies to unlock value through redevelopment into Hospitality
modern and sustainable facilities, in line with shifting • Malaysia’s economy showed resilience in the first nine
market and investor priorities. months of 2024, with a projected annual growth rate
• Klang Valley’s industrial sector performance is bolstered of 4.8% to 5.3%, driven by robust domestic demand,
by high levels of approved private investments, totaling recovering exports and a thriving tourism sector.
impressive figures in the first nine months of 2024. This • Kuala Lumpur leads in existing hotel room supply, with
reflects robust investor sentiment and signals continued a strong pipeline of new hotels, particularly mid-scale
economic growth and development in the region. properties managed by international brands.
• The sector remains stable in prices and rental rates, • As of 3Q2024, the hospitality sector is recovering,
underpinned by sustained demand and a resilient with occupancy rates and room rates nearing pre-
market. While higher-quality assets, such as Grade pandemic levels.
A warehouses, command premium rates, the overall • The government is boosting tourism through
consistency in performance underscores strong infrastructure enhancements and promotional efforts,
fundamentals. This stability offers confidence to both including Visit Malaysia Year 2026 and upgraded entry
investors and occupiers, supporting the sector’s steady facilities for large-scale MICE events.
growth and long-term potential. • With strategic policies and sustained infrastructure
improvements, Malaysia is well-positioned for continued
Office growth in tourism and hospitality sectors through 2025.
• During the review period, 0.4 million sq ft of office space
was completed with the opening of Atwater Corporate High Rise Residential
Towers, bringing the total for 2024 to 0.8 million sq ft. • The high rise residential property market in W.P. Kuala
Looking ahead, approximately 1.6 million sq ft of new Lumpur is showing growth in 2024, driven by improved
supply is expected to be completed in 1H2025. transaction activity. This positive trend is underpinned
• The Klang Valley office market demonstrated resilient by strong economic performance under the MADANI
demand, with improved occupancy and rental rates Economy Framework, sustained government support
across all submarkets. However, these levels remain through Budget 2024 and stable interest rates.
below pre-pandemic figures. KL City and KL Fringe • Supply and demand for high rise residential developments
recorded notable occupancy gains, while Selangor are expected to strengthen with the launch and preview of
experienced some moderation due to the influx of new new projects. While property prices remain stable, rental
supply. Positive rental momentum was observed across trends exhibit mixed performance due to varying tenant
The Malaysian real estate market all submarkets, albeit at varying rates. preferences and increasing market competition.
• Occupiers continue to favour green-certified buildings with • The Residensi Madani initiative aims to deliver 8,000
demonstrates resilience and flexible layouts and modern amenities, leading to higher affordable homes in the Federal Territories by 2027.
adaptability, supported by strategic occupancies and rents in Prime A+ and Grade A offices. Targeted at the B40 income group, this program seeks
investments and government This demand has been driven by diverse sectors, including to provide accessible homeownership opportunities
initiatives. With economic technology, finance and professional services. in Kuala Lumpur, addressing persistent housing
affordability challenges.
recovery gaining momentum, key Retail
sectors such as industrial, office, • The Klang Valley retail market is set to grow in 1H2025
retail, hospitality and residential with an additional 1.0 million sq ft of retail space, including
two neighborhood malls designed to meet the rising
continue to show promising growth demand for community-oriented retail experiences.
trajectories. This section explores • The Malaysian retail sales grew by 3.8% in 3Q2024,
the pivotal trends and developments driven by strong domestic demand and tourist spending,
shaping the market landscape in the despite rising costs. Growth is projected to accelerate to
4.4% in 4Q2024, supported by the Malaysia Year-End
second half of 2024. Sale and government initiatives, reflecting the sector’s
resilience amidst economic challenges.
• New developments such as Bloomsvale Shopping Gallery,
Elmina Lakeside Mall and the recently opened 168 Park

3
JOHOR
Industrial Key Developments and Investments in
The industrial property sector remains robust, supported by Iskandar Malaysia
active transactions and strong investment activity. • The Johor Bahru-Singapore RTS Link is 93% complete,
and the Gemas-Johor Bahru Electrified Double-Track
Office Rail Project is 98% complete, with full completion
The Johor Bahru office market has seen an increase expected by April 2025.
in asking rents for purpose-built office spaces. This is • Iskandar Malaysia recorded RM40.3 billion in
attributed to newer buildings with better specifications and committed investments as of 3Q2024, with RM22.5
improved market sentiment. billion (55.8%) realised. Cumulative investments reached
RM413.1 billion (70.5% or RM291.4 billion realised), with
Retail a target of RM636.0 billion by 2030.
The retail sector continues to gain positive momentum, • Korean firm GG56 Korea Ltd will invest approximately
driven by heightened retailer activity and the entry of new RM4.4 billion in Forest City to establish Malaysia’s first
retailers, which are contributing to the sector’s overall Korean Culture Town, including K-Content Studios and
growth. residential developments. The newly launched Forest
City Special Financial Zone (SFZ) offers a 0% tax rate
Hospitality for family wealth offices, a 15% income tax rate for
Johor’s hospitality sector saw a 31.8% increase in tourist
arrivals during the first ten months of 2024, driven by its
proximity to Singapore, which contributed for 79.4% of
knowledge workers and duty-free status to boost tourism
and economic activity.
• Harn Len Corp Bhd disposed of a 0.9-acre parcel of
PENANG
total arrivals and a significant rebound in Chinese visitors. land near the RTS Link station in Johor Bahru for
Rising occupancy rates and average daily rates for 3- to RM55.0 million, capitalising on the strategic location’s Industrial Key Infrastructure Projects in Penang
5-star hotels highlight the sector’s strong recovery and its development potential. Meanwhile, Paragon Globe Bhd During the first nine months of 2024, Penang secured • Penang International Airport (PIA) is expanding to
growing position as a key regional tourism hub. secured 67.4 acres in Iskandar Puteri for a residential RM10.1 billion in foreign direct investment (FDI), increase annual passenger capacity from 6.5 million
project with a gross development value (GDV) of RM733.1 representing 83.5% of the State’s total manufacturing to 12 million and accommodate 28 aircraft
High Rise Residential million, marking its entry into the landed residential investment of RM12.1 billion, highlighting Penang’s simultaneously. Scheduled for completion by 2028,
The high rise residential sector in Johor Bahru has shown property market. Additionally, Lagenda Properties Bhd resilience in sustaining its industrial growth momentum. the project includes terminal upgrades, airside
improved performance, particularly for projects located in acquired 139.0 acres in Kota Tinggi for RM99.6 million, improvements and 10 automated gates set to be ready
Johor Bahru City Centre, which benefit from their proximity further expanding its landbank to support future Office by 1Q2025, solidifying PIA as Malaysia’s second-largest
to the upcoming RTS Link station. development initiatives. The Penang office market experienced a slight decrease in airport and a regional hub.
• TMC Life Sciences Bhd will start construction of the overall occupancy levels on Penang Island due to the newly • The Penang Light Rail Transit (LRT) Mutiara Line,
Thomson Iskandar Medical Hub in 2025, featuring a opened Sunshine Tower. Conversely, the overall occupancy developed by MRT Corporation, will connect Bayan
500-bed hospital, 400 medical suites and research rate in Seberang Perai showed a marginal improvement. Lepas to Komtar and Penang Sentral in Seberang Perai,
facilities, with completion by 2030. featuring 21 stations and “Park and Ride” facilities with
Retail 1,100 parking spaces at nine locations. The project tender
The retail sector in Penang demonstrated consistent and was opened on 2 December 2024, inviting local and
stable performance during the review period. This stability international firms.
is evident in the steady average rental rates, despite a • The Juru-Sungai Dua Elevated Highway, a 15-kilometer
moderate decline in overall occupancy rates. The decrease project announced in Budget 2025, will begin next year
was largely due to the low occupancy from the newly and is slated for completion by 2029. This RM2.0 billion
completed Sunshine Mall, which introduced a substantial public-private partnership (PPP) initiative aims to reduce
820,000 sq ft of net lettable area to the market. congestion at the Juru and Sungai Dua toll plazas on the
North-South Highway.
Hospitality
The hospitality market in Penang is transitioning from the
recovery phase to a period of stabilisation, with sustainable
growth observed in both the average occupancy rate
(AOR) and average daily rate (ADR). This upward trend
has been further supported by the opening of several new
hotels in 4Q2024, including the Iconic Marjorie Hotel (A
Tribute Portfolio Hotel by Marriott) in Bayan Lepas, lyf
Georgetown Penang, Citadines Connect Cecil Georgetown
in George Town and The Crowne Plaza Penang Straits City
in Butterworth.

High Rise Residential

Within the first nine months of 2024, the serviced
apartment market in Penang demonstrated sustained
demand, showcasing resilience within the residential
property segment. However, the condominium and
apartment market experienced a decline in both transaction
volume and value during the same period.

4 5
SABAH
Key Infrastructure Projects in Sabah
• The Sabah Pan Borneo Highway, spanning 706 km at a cost
of RM24.8 billion, is progressing steadily. As of November
2024, Phase 1A (78% completion) and Phase 1B (2%
completion) are advancing, with all contracts awarded and
final packages set to be finalised by year-end.
• The Sarawak-Sabah Link Road (SSLR), connecting the two
states without passing through Brunei, is making progress.
Phase 1 (76 km) reached 40.2% completion as of October
2024, while Phase 2 (322 km) began construction in August
2024 with site clearing and earthworks underway.

Renewable Energy Projects

Sabah is advancing its renewable energy goals through several
key initiatives:
Industrial • Project Oriole, a 162 MW hydropower plant in Sipitang
The industrial sector in Sabah is gaining momentum, with developed by Jentayu Sustainables Bhd, will generate
renowned industry players investing in various projects, thereby 170 MW across two hydropower schemes, aligning with
contributing significantly to the State’s economic growth. the Sabah Energy RAMP 2040 strategy.
• The Ulu Padas Hydroelectric Project, a 187.5 MW project
Office led by Gamuda Bhd and valued at RM3.05 billion,
The office sector in Kota Kinabalu recorded a steady increase in is expected to produce 1,052 GWh of clean energy
occupancy rates for privately-owned purpose-built offices. This annually, significantly strengthening the state’s
growth is driven by rising interest in prominent office spaces renewable energy mix.
within the Kota Kinabalu Central Business District (CBD). • Additionally, the Battery Energy Storage System (BESS),
developed by MSR Green Energy Sdn Bhd, will feature a
Retail 100 MW capacity with 400 MWh storage. Valued at RM645
Prime shopping malls within the Kota Kinabalu CBD are million, this project will be one of Southeast Asia’s largest
intensifying efforts to enhance their tenant mix. This is evident BESS, enhancing grid stability, improving reserve margins
from several retail units currently undergoing fit-out as part of and supporting solar energy expansion.
repositioning strategies. Additionally, efforts are underway to
attract new retailers to introduce to the local market.
Transaction Volume and Value of Property
Hospitality
Sabah is on track to surpass its target of 3.0 million visitors
Sub-Sector in Sabah, 1H2023 and 1H2024

Property
Transaction Volume
(No. of Units)
SARAWAK
by the end of 2024, supported by a sustained influx of Y-o-Y Growth
Sub-Sector
tourist arrivals during the review period. Key initiatives 1H2023 1H2024 • Sarawak is advancing deep-sea port projects at Tanjung • Sarawak’s commercial property market is thriving,
boosting this growth include the ongoing upgrade of Residential 2,425 2,733 12.7%
Embang and Kuala Baram, Miri and will assume driven by a 25.0% increase in tourist arrivals in 2024,
Kota Kinabalu International Airport (KKIA) and the control of Bintulu Port by 2024 under the Sarawak Port which generated RM10.27 billion in revenue. This surge
Commercial 533 668 25.3%
introduction of new flight routes to the state. The growing Authority to boost export potential. Key infrastructure in tourism has fueled demand for hospitality and retail
confidence in Sabah’s tourism potential is reflected in the Industrial 211 160 -24.2% projects, including the Second Trunk Road (STR), spaces, including hotels, resorts, serviced apartments and
hospitality market, as seen in the emergence of reputable Agriculture 770 925 20.1% Marudi Bridge and Bintulu-Jepak Bridge, aim to enhance commercial properties. Strategic developments, such as
new hotels and resorts. connectivity, reduce travel time and drive economic Transit-Oriented Developments (TODs) along Autonomous
Development
615 438 -28.8% activity. The Sabah-Sarawak Link Road (SSLR) is set for Rapid Transit (ART) routes and the completion of the
Land & Others
Residential Total 4,554 4,924 8.1%
completion by 2029, connecting the two states without Hikmah Exchange Event Centre, are further enhancing the
During the review period, smaller scale landed terraced passing through Brunei. sector’s growth and investor appeal.
residential developments were launched, primarily in the fast- Transaction Value • Sarawak achieved 62% renewable power generation
Property (RM Million)
growing districts of Papar and Tuaran. This trend is attributed Y-o-Y Growth in 2024, supported by significant investments in
Sub-Sector
to rising land costs and the effects of urban sprawl. 1H2023 1H2024 hydropower and green hydrogen production, including
RM4.2 billion secured in 1Q2024. These initiatives
Residential 962.53 1,146.53 19.1%
Transaction Activity and Growth position Sarawak as a leader in ASEAN’s renewable
• Sabah’s property market experienced robust growth in Commercial 347.27 452.65 30.3% energy sector, reflecting its growing competitiveness and
1H2024, with transaction volume increasing by 8.1% sustainable development focus.
Industrial 311.14 338.27 8.7%
and value rising by 20.8% compared to 1H2023 (4,554 • The Sarawak government acquired a 31.25% stake in
transactions valued at RM2.28 billion). Agriculture 245.88 415.31 68.9% Affin Bank to bolster the state’s financial infrastructure,
• The residential, commercial and agriculture sub-sectors improve funding access for local businesses and support
Development
showed strong positive growth in both volume and 417.22 406.11 -2.7% broader economic development goals.
Land & Others
value, with agriculture recording the highest growth in • The RM1 billion Sarawak Cancer Centre in Kota
transaction value (68.9%). The industrial sub-sector saw Total 2,284.04 2,758.87 20.8% Samarahan will enhance healthcare services, establish
a decline in transaction volume (24.2%) but achieved Sources: National Property Information Centre (NAPIC) / Sarawak as a hub for research and training and
an uptick in transaction value (8.7%). Conversely, the Knight Frank Research provide advanced medical care, including stem cell
development land sub-sector experienced a decline in Note: There may be some discrepancies due to rounding of figures transplantation and cellular therapy.
both volume (28.8%) and value (2.7%) of transactions. Sources: Google Earth / Knight Frank Research

6 7
 MARKET
Regional Investment Trends
(Manufacturing Sector)
• Central Region: The Klang Valley approved 264 private

INDICATIONS
investments totalling RM15.3 billion, securing its
position as the second-highest contributor after Kedah

INDUSTRIAL
in 9M2024. Negeri Sembilan demonstrated impressive
growth, with investments surging to RM5.2 billion, four
times the RM1.2 billion recorded during the same period
in 2023, placing it among the top five contributing states.
Industrial Production Index (IPI) • Northern Region: Kedah emerged as the nation’s leader

MARKET
The Industrial Production Index (IPI) in 2024 is in approved investments, contributing RM32.6 billion,
projected to maintain a positive trajectory, bolstered which accounted for 36.7% of the total manufacturing
by strong performance in the first nine months of the investment. Penang, on the other hand, experienced
year. During this period, the IPI recorded a year-on- a decline in manufacturing investments, dropping
year (y-o-y) growth of 3.9%, compared to the same 68.9% from RM38.9 billion in 9M2023 to RM12.1 billion
period in the previous year. in 9M2024. Nevertheless, FDI remained the largest
contributor, accounting for 82.9% of the total.
Approved Investments • Southern Region: Johor recorded a 12.5% increase in
Malaysia approved RM254.7 billion in investments manufacturing investments, reaching RM8.0 billion
during the first nine months of 2024, reflecting in 9M2024.
a 10.7% y-o-y increase. This robust performance • East Malaysia: Sarawak contributed RM5.1 billion in
underscores strong investor confidence across the approved investments, ranking slightly behind Negeri
services (RM160.7 billion), manufacturing (RM88.8 Sembilan and securing itself as one of the top investment
billion) and primary (RM5.2 billion) sectors. destinations nationwide. In contrast, Sabah recorded
Domestic investments dominated with RM148.0 RM2.4 billion in approved investments, reflecting a
billion (58.1% of total), while foreign investments 79.0% increase from RM1.37 billion in 9M2023 to
contributed RM106.7 billion (41.9%), highlighting RM2.4 billion in 9M2024.
balanced participation from both local and
international investors. Selangor, Kuala Lumpur, Market Overview
Kedah, Penang and Johor emerged as the top- Malaysia’s industrial sector has experienced significant
performing states by investment value. growth, underpinned by increasing global demand for
manufactured goods, government initiatives promoting
During the review period, the manufacturing sector industrialisation and the establishment of new industrial
accounted for 34.9% of the nation’s total approved parks. This positive trajectory is expected to continue,
investments. Foreign direct investment (FDI) driven by ongoing investments, technological advancements
remained a cornerstone of this growth, contributing and a growing emphasis on sustainability, even as the sector
a substantial 75.4% of total manufacturing navigates a complex global landscape.
investments.
The country is well-positioned to capitalise on evolving global
The electrical and electronics (E&E) industry trade dynamics and supply chain realignments, particularly
continued to drive Malaysia’s manufacturing in the wake of the 2024 US presidential election. With a
momentum, securing RM47.0 billion in approved robust manufacturing ecosystem and a strategic location,
investments. This reaffirms the nation’s growing Malaysia is poised to attract investments in high-growth
reputation as a strategic hub for comprehensive sectors such as electronics, semiconductors and medical
business solutions, encompassing research and devices. Potentially renewed US engagement in multilateral
development (R&D), manufacturing, supply chain trade agreements, such as the Comprehensive and Progressive
management, logistics and global headquarters Agreement for Trans-Pacific Partnership (CPTPP), could
operations. further enhance Malaysia’s market access and strengthen its
role in global trade. Additionally, the nation’s commitment
The industrial market remains Other key industries contributing to the to renewable energy and sustainability aligns with global
robust, driven by sustained manufacturing sector’s strong performance included: trends, presenting opportunities for collaboration with foreign
investors in green technology.
demand for modern facilities • Transport Equipment: RM7.0 billion
and strategic investments • Non-Metallic Mineral Products: RM4.2 billion Malaysia is also prepared to address challenges arising from
in smart and sustainable • Chemicals and Chemical Products: RM7.0 billion shifts in US trade and foreign policies. While global supply
• Machinery and Equipment: RM6.3 billion chain realignments and geopolitical tensions may pose risks,
industrial parks. Innovations in Malaysia’s diversified trade partnerships and integration
logistics and green-certified into regional frameworks like the Regional Comprehensive
developments are redefining the Economic Partnership (RCEP) provide a buffer against
landscape, positioning Malaysia external disruptions.

as a key hub for regional and Malaysia has solidified its position as a top investment
global industrial activity. destination in Southeast Asia, leveraging its strategic
advantages as companies diversify their supply chains amidst
shifting global dynamics. Compared to other ASEAN nations,
Malaysia’s ability to attract high-value, technologically

9
 advanced investments, positions itself as a strong KLANG VALLEY
contender, reinforcing its role as a top choice for foreign
direct investments. Industrial Market Activities

Moreover, domestic policy such as the implementation During the first nine months of 2024, the industrial sector
of a carbon tax and the EU’s Carbon Border Adjustment recorded a significant increase in both transaction volume
Mechanism are incentivising businesses to adopt and value compared to the same period in 2023, reflecting
sustainable practices. The demand for green-certified strong market performance. A total of 2,208 transactions
industrial buildings, such as those meeting GreenRE were registered, amounting to RM10.8 billion. This marked
and GBI standards, is on the rise, driven by companies a y-o-y growth of 8.6% in transaction volume and an
aiming to reduce their environmental impact and attract impressive 25.7% increase in transaction value.
eco-conscious tenants. The integration of renewable
energy solutions, particularly solar power, is increasingly Additionally, the average price per industrial transaction
prevalent, enabling industrial facilities to lower rose by 15.7% y-o-y to approximately RM4.9 million,
operational costs and reduce carbon emissions. signaling a shift toward higher-value transactions during
this period.
The sector’s growth is underscored by transformative
projects and partnerships. For instance, Sime Darby
Property, EcoWorld and NS Corp have joined forces
Transaction Volume and Value of Industrial Properties
in Klang Valley, 2019 to 3Q2024 (p)
to develop a RM2.95 billion industrial park in Negeri
Sembilan, targeting high-growth industries. Similarly, 3,000 10,645.5 12,232.8 13,000
the Kerian Integrated Green Industrial Park (KIGIP) 10,846.9

Transaction Value (RM Million)

Transaction Volume (No. of Units)
8,654.1
in northern Malaysia is set to attract high-value 2,250
9,152.4
8,632.7 9,750
investments and create jobs. In Selangor, AME Elite 7,490.2

and KLK are collaborating on a sustainable, integrated 1,500 6,500

industrial park in Ijok, designed to foster a self-
sustaining ecosystem while attracting high-value 750 3,250
investments. These initiatives highlight the increasing
demand for industrial space and the government’s 2,361 1,686 2,049 2,880 2,741 2,033 2,208
0 0
commitment to fostering sustainable development. 2019 2020 2021 2022 2023 1Q-3Q
2023
1Q-3Q
2024(p)
Transaction Volume (No. of Units) Transaction Value (RM Million)

Malaysia’s industrial sector is thriving, propelled by

Sources: National Property Information Centre (NAPIC) / Knight Frank Research
global demand, strategic government initiatives and
investments in infrastructure and sustainability. As the
sector evolves, it is well-equipped to navigate challenges Notable Investments in Klang Valley
Notable Investment Announcements, 2024
and seize opportunities, ensuring its continued growth
and relevance on the global stage. Selangor continues to solidify its role as a key industrial Investment Value
Company Country of Origin Industry Location Type of Investment
hub, attracting substantial investments in green and (RM)
transport technologies. Among notable developments,
J&T Berjaya Alam Murni Bukit Tagar Enviro Park,
Japan’s J&T Berjaya Alam Murni Sdn Bhd (JBAM) has Japan Green Technology New Investment RM172 million
Sdn Bhd (JBAM) Selangor
committed RM172 million to a green technology project at
MCE Holdings Bhd Malaysia Transport Technology Serendah, Selangor New Investment RM50 million
the Bukit Tagar Enviro Park. Meanwhile, local player MCE
Holdings Bhd is investing RM50 million in a new transport CHERY Auto Malaysia
China Transport Technology Shah Alam, Selangor Expansion RM1.4 billion
technology facility in Serendah. Sdn Bhd

DHL Express USA Logistics Services KLIA, Selangor Expansion RM280 million (1)
A China-based company, CHERY Auto Malaysia Sdn Bhd,
is expanding its footprint in Selangor with a significant Sources: Malaysia Investment Development Authority (MIDA) / Knight Frank Research
investment of RM1.4 billion to enhance its Shah Alam Note: (1) DHL Express has invested EUR60 million into the facility. The exchange rate used is circa EUR 1 = MYR 4.6601
operations, further boosting the state’s industrial growth.

DHL Express has made a landmark investment of €60 This momentum is further bolstered by new industrial With six new industrial parks spanning 1,214 hectares
million (RM300 million) in a state-of-the-art, fully park projects in the state. A joint venture between AME currently under development, these projects align with
automated sorting facility at Kuala Lumpur International Elite Consortium Bhd and Kuala Lumpur Kepong Bhd Selangor’s commitment to fostering economic growth and
Airport (KLIA), which was completed in March 2024. The (KLK) under Oasis Innovation Sdn Bhd exemplifies cultivating a skilled workforce. Such initiatives further
DHL Express Kuala Lumpur Gateway, three times larger confidence in Selangor’s industrial sector. This project reinforce Selangor’s position as a prime destination for
than its predecessor and capable of handling four times the spans approximately 151.2 acres near Bandar Seri Coalfields industrial and technological advancement.
shipping volume, serves as a strategic hub for cross-border and the LATAR Expressway. Notably, it marks KLK’s first
trade in Southeast Asia. Built with carbon-neutral building foray into industrial property development, leveraging AME Prices & Rentals
guidelines, the facility incorporates solar panels, smart LED Elite’s expertise to unlock the value of its land assets.
lighting and energy-efficient systems, aligning with the During the review period, asking rentals for detached
growing trend of sustainable industrial real estate. Selangor’s proactive efforts to attract high-value industries industrial buildings and warehouses in the selected
further amplify this momentum. For example, the state localities remained relatively stable. Premium rental rates
These developments underscore Selangor’s growing appeal plans to develop a semiconductor park under Menteri Besar of RM2.00 to RM2.50 per sq ft were observed for higher-
to both global and domestic investors. Its robust industrial Selangor Incorporated, aiming to position Selangor as a quality industrial assets, particularly in Bandar Bukit Raja.
ecosystem, strategic location and supportive business strategic hub for the semiconductor industry. This initiative With the anticipated increase in the supply of higher-quality
environment continue to position it as a leading destination is guided by the Selangor Managed Industrial Parks industrial properties, rental rates are expected to trend
for high-value industrial developments. (MIP) framework, which emphasises advanced features, upward in the foreseeable future.
sustainability and customised infrastructure.

10 11
 Asking Rental Rates of Typical Detached Industrial In 2H2024, several notable industrial property transactions were recorded in the Klang Valley (>RM20 million).
Buildings / Warehouses in Selected Localities, 2H2024
Consideration (RM)
Type of Property Land Area / Estimated
Average Asking Rental over Built-up Area (2) Date Status Analysis over Land Area
Locality Property Address Built-up Area (BUA)
(RM per sq ft / month) (RM per sq ft)

Freehold industrial land with 2 units of 3-storey detached factory 2.0 acres 26.0 million
Bandar Bukit Raja 1.80 - 2.30 Jul-24 Pending(1) No. 11 & 13, Jalan Cipta Serenia 1, Pusat Perindustrian Cipta Selatan, 43900 Sepang,
Selangor
N/A 298

Shah Alam (1) 1.70 - 2.40 Freehold industrial land 28.0 acres 79.3 million
Jul-24 Sold PT 149649, Jalan Sungai Pinang 4/1 Bandar Armada Putra, Selangor N/A 65
Petaling Jaya (2) 1.80 - 2.50
2 lots of freehold industrial lands with semi-detached factory 1.3 acres 22.0 million
Jul-24 Pending(2) 2A & 6, Jalan Cipta Serenia 8, Pusat Perindustrian Serenia, Bandar Serenia, 43900
Sepang, Selangor Darul Ehsan
(35,216 sq ft) 388
Subang (3) 1.50 - 2.30
Freehold industrial land with detached factory 3.3 acres 25.1 million
Jul-24 Sold
Port Klang (4) 1.50 - 1.90 4442 (PT 15972), off Jalan Pusara Bandar Industrial Zone, Selangor N/A 172

Freehold industrial land with detached factory 1.1 acres 20.0 million
Jul-24 Sold
Sepang (5) 1.40 - 1.80 Lot 17520, Jalan 2 Taman Selayang Baru, Selangor N/A 431

Source: Knight Frank Research Leasehold industrial land with two 1-storey warehouses together with two
1-storey office buildings annexed and ancillary buildings 6.4 acres 23.7 million
Notes: Asking rentals (on a per square foot basis), as listed on property websites, Aug-24 Pending(3)
No. P823, Precinct 8, Jalan FZ1-P8, Port Klang Free Zone/KS12, 42920 Pulau Indah, (193,365 sq ft) 85
for typical detached industrial buildings and warehouses in the selected Selangor
localities during the period from September 2024 to November 2024.
Selected industrial schemes within the localities are as follows:
Freehold industrial land with a single storey detached factory with a
(1) Shah Alam: Bukit Kemuning, Hicom-Glenmarie Industrial Park, Seksyen 15, 2.1 acres 22.6 million
Seksyen 16, Seksyen 22, Seksyen 32, Seksyen U10, Shah Alam Technology Aug-24 Pending(3) mezzanine floor and a 4-storey office building
No. 35, Jalan CJ 1/1, Kawasan Perusahaan Cheras Jaya, 43200 Cheras, Selangor
(67,644 sq ft) 247
Park and Temasya Industrial Park.
(2) Petaling Jaya: Seksyen 19, Seksyen 51 and Seksyen 51A.
(3) Subang: Taman Perindustrian Subang, Subang Hi-Tech Park and UEP Leasehold industrial land with detached factory 24.8 acres 216.0 million
Industrial Park. Sep-24 Sold
1, Persiaran Waja, Bandar Bukit Raja, Selangor N/A 200
(4) Port Klang: Northport, Westport and Teluk Panglima Garang.
(5) Sepang: NCT Smart Industrial Park, Olak Lempit, Pekan Sepang and others.
Leasehold vacant industrial land 28.0 acres 79.3 million
Oct-24 Sold
Klang, Selangor N/A 65
The transacted prices for vacant industrial land (less than Leasehold industrial land with a unit of a single storey detached
15 acres) in selected localities of Klang Valley in 2024 vary Oct-24 Pending(4) warehouse 1.2 acres 27.0 million
No. 19 & 21, Jalan 6/37A, Taman Bukit Maluri Industrial Area, Kepong, 52100 Kuala N/A 515
based on factors such as location or scheme, accessibility Lumpur
and frontage, land size and tenure, infrastructure
level, built-up area or specifications and other related Leasehold industrial land with a 1-storey warehouse annexed with a 4.5 acres 48.6 million
Nov-24 Sold 2-storey office building and other ancillary buildings
considerations. Port Klang, Selangor
(138,719 sq ft) 247

Freehold industrial land with a 1-storey industrial warehouse with

Transacted Prices of Vacant Industrial Land (< 15 annexed 3-storey office building together with ancillary buildings to be 6.5 acres 180.0 million
acres) in Selected Localities in Klang Valley, 2H2024 Dec-24 Pending(5) erected on the land. (160,024 sq ft) 635
No. 16 & 18, Jalan Sinergi 1, Taman Perdagangan Elmina, 47000 Sungai Buloh,
Selangor
Corresponding Land Area Transacted Price
Locality
(ac) (RM psf) Sources: Bursa Malaysia / Jabatan Penilaian dan Perkhidmatan Harta (JPPH) / Knight Frank Research
Notes:
Shah Alam (1) 1.28 - 2.65 180 - 250 (1) The proposed disposal is part of the Groups effort to rationalise non-core assets leading to reduce operational and maintenance costs of their properties.
(2) The proposed acquisitions are for the business operation of the Group to accommodate business expansion.
(3) The proposed acquisitions are to continuously pursue assets that are income-producing and are able to contribute to the long-term growth of the portfolio of the Group.
(4) The proposed disposal is driven by the Group’s commitment to a cost rationalisation strategy and improving management efficiency.
Ijok(2) 0.66 - 4.01 85 - 95 (5) The proposed disposal enables the Group to unlock the value of its investment in the Property and to immediately monetise its investment in the Property.
The Property / warehouse will be equipped with an Automated Storage and Retrieval Racking System (ASRS).

Klang (3) 0.75 - 4.96 70 – 140

Market Outlook The role of Real Estate Investment Trusts (REITs) in the
Kuala
1.26 - 2.19 75 – 85 industrial real estate sector continues to evolve in response
Selangor
Investor confidence in the Klang Valley remains strong, to shifting market dynamics. Historically significant, REITs
Serendah (4) 2.00 - 14.59 20 - 45 driven by substantial foreign and domestic investments now face challenges in sourcing institutional-grade assets,
across high-growth sectors such as green technology, prompting a strategic pivot. For instance, REITs such as
Sources: Jabatan Penilaian dan Perkhidmatan Harta (JPPH) /
Knight Frank Research transport and logistics. Nationwide, numerous joint Axis are increasingly targeting sites with shorter-term
Notes: Selected industrial schemes within following localities as follows: ventures and partnerships are underway, with Selangor potential that offer redevelopment opportunities. This shift
(1) Shah Alam: Bukit Jelutong and Seksyen 27, Shah Alam.
(2) Ijok: Eco Business Park V and Alam Jaya Industrial Park.
emerging as a key player. The state is positioning itself as highlights the changing priorities as REITs aim to unlock
(3) Klang: Kapar industrial area, Bukit Kemuning Light Industrial Park and others. a leader in semiconductor and advanced manufacturing value through innovative asset strategies in a competitive,
(4) Serendah: Sungai Choh and Sungai Buaya industrial area.
industries, reflecting its alignment with broader economic supply-constrained environment.
and technological trends.
Overall, the Klang Valley’s industrial real estate market
The Klang Valley industrial property market has is well-positioned to capitalise on growing demand for
demonstrated robust performance, characterised by steady logistics, smart technologies and sustainable solutions.
growth in transaction volumes and values. This growth is Supported by relatively stable asking prices and rental
fueled by businesses prioritising quality infrastructure in rates, the market reflects strong underlying demand and
strategic locations, which has supported rising transaction resilience. While the outlook for the industrial sector is
values and market stability. However, the emergence promising, it is crucial to address potential challenges
of new, large-scale industrial townships is expected to such as global economic uncertainty and geopolitical
heighten competition in the market. As these projects reach risks. Effectively navigating these obstacles will enable the
completion, they may exert downward pressure on prices market to seize emerging opportunities and sustain long-
and rental rates in the short term. term growth.

12 13
 JOHOR Industrial Complex. These facilities
Notable Transactions of Industrial Properties in the Districts of Johor Bahru & Kulai, 2H2024
are expected to meet rising demand
Industrial Market Activities and enhance the port’s role within the
Date of
Johor-Singapore Special Economic Announcement / Purchaser Location Land Area
Property Type / Consideration
Component (RM million)
The overall industrial market activities in the districts of Johor Bahru and Kulai Zone (JS-SEZ), strengthening regional Transaction
experienced a marginal increase of 5.8% during the first nine months of 2024. integration and logistics capabilities.
Under Construction
While market activity softened in Johor Bahru, higher-value industrial properties 3.0 acres RM27.0 million
Detached Factory
changed hands, resulting in a 44.6% increase in transaction value compared to the United Overseas Bank (UOB) and i-TechValley
same period in 2023. In contrast, the district of Kulai demonstrated strong market China’s Lingang Group, an industrial 3.0 acres Detached Factory RM27.5 million
activity, with transaction volumes rising by 66.9% and transaction values nearly park operator with over 18,000 AME Real Estate
24-Jul-24
Investment Trust
doubling from RM426.73 million to RM829.80 million. tenants in China, have signed a 3.7 acres Detached Factory RM45.0 million
Memorandum of Understanding i-Park@Senai
(MoU) to facilitate Lingang’s tenants Airport City Under Construction
Transaction Volume and Value of Industrial Properties in the District of 2.0 acres
Detached Factory
RM20.0 million
Johor Bahru & Kulai, 1Q-3Q2023 and 1Q-3Q2024 in expanding into Southeast Asia.
This partnership underscores Johor’s Paragon Business Hub
Transaction Volume (No. of Units) 29-Jul-24 Ulu Tiram 19.3 acres Vacant Land RM35.0 million
appeal as a destination for foreign Sdn Bhd
District Y-o-Y Growth industrial investments.
1Q - 3Q 2023 1Q - 3Q 2024 23-Aug-24 Goldcoin Victory Sdn Bhd Senai Industrial Area 10.2 acres Detached Factory RM31.0 million

Key Green Industrial Projects KIP REIT Management

Johor Bahru 684 642 -6.1% 29-Aug-24 Pasir Gudang 5.7 acres Detached factory RM23.3 million
Sdn Bhd
in Johor
Kulai 133 222 66.9%
Sources: Bursa Malaysia / Jabatan Penilaian dan Perkhidmatan Harta (JPPH) / Knight Frank Research
There is heightened industry
Total 817 864 5.8%
awareness of Environmental, Social
Transaction Value (RM Million) and Governance (ESG) initiatives UEM Sunrise Bhd is collaborating with Itramas Corporation incentives for businesses adopting sustainable practices
District Y-o-Y Growth in Johor, driving a gradual shift and China Machinery Engineering Corporation (CMEC) and encouraging the use of alternative water sources to ease
1Q - 3Q 2023 1Q - 3Q 2024 toward green industrial parks. ESG to establish a Renewable Energy (RE) Industrial Park at local resource strain.
initiatives in the industrial sector Gerbang Nusajaya. This industrial park is part of the 1GW
Johor Bahru 2,289.94 3,311.91 44.6% hybrid solar power plant project, a flagship initiative under With its emphasis on green initiatives, innovative industrial
encompass energy management,
workers’ accommodations and Malaysia’s National Energy Transition Roadmap (NETR), parks and favorable market dynamics, Johor is well-
Kulai 426.73 829.80 94.5%
compliance with ethical standards. spearheaded by UEM Lestra Bhd. positioned to attract investors and businesses. This strategic
Total 2,716.67 4,141.71 52.5% Johor is witnessing a growing focus will further reinforce its role as a leading industrial
supply of green industrial parks China-based companies have shown significant interest in hub in Malaysia and Southeast Asia.
Sources: National Property Information Centre (NAPIC) / Knight Frank Research
that integrate renewable energy becoming off-takers and setting up manufacturing facilities
and technological advancements. within the RE Industrial Park. Two companies, CMEC Wuxi
Eco World has rebranded its upcoming Eco Business Park VI in Kulai as Quantum Developers increasingly recognise the and Longmax, are already in the process of establishing
Edge, positioning it as a new revenue pillar aimed at fostering a digital and high- importance of meeting green building local operations, including facilities for solar module and
tech ecosystem. Spanning 403.8 acres, the park’s focus is on companies specialising requirements and certifications to combiner box production.
in artificial intelligence (AI), cloud computing, high-tech manufacturing and satisfy tenant demand and enhance
research and development (R&D). Microsoft has already been secured as the first their reputations. Market Outlook
anchor tenant, signaling strong interest from global tech leaders.
SD Guthrie Bhd and AME Industrial Johor is undergoing a transformative evolution, positioning
Crescendo Corporation Bhd is acquiring SGR Land Development Sdn Bhd and its Park Sdn Bhd have signed a itself as a hub for sustainable and high-tech industries.
six land purchase agreements in Johor for RM168.9 million. The lands, located in Memorandum of Understanding With a strong focus on ESG principles and alignment with
Mukim Jeram Batu, Pontian, cover a total of 135 acres with medium industrial and (MoU) to jointly develop a green Malaysia’s national energy transition goals, the state is
commercial titles. Transacted prices range between RM26.50 and RM40.00 per sq industrial park in Kulai. Spanning fostering innovative industrial ecosystems powered by
ft. The acquisition is expected to be completed by2Q2025, paving the way for future 641 acres in SD Guthrie’s Kulai renewable energy and cutting-edge technologies.
industrial property developments. estate, the park will feature a
dedicated solar park to supply green Strategic locations such as Kulai are emerging as investment
Petroliam Nasional Bhd (Petronas) has entered a joint venture with Italy’s Enilive energy to its industrial tenants. The hotspots, driven by their focus on high-value industries,
SpA (a unit of Eni SpA) and Japan’s Euglena Co Ltd to develop a biorefinery at development aims to attract high- including logistics, clean technology and advanced
Pengerang Integrated Complex (PIC). The project, valued at RM6.1 billion, is value industries, including logistics, manufacturing. Infrastructure expansions, such as port
scheduled to commence operations by 2H2028. advanced manufacturing and clean enhancements and the development of advanced industrial
technologies. parks, are further solidifying Johor’s position as a regional
In November 2024, Petronas announced additional investments of RM7.5 billion trade and investment hub.
in the PIC. These investments include a 40-megawatt solar energy project in Paragon Platinum Sdn Bhd is
partnership with LG Chem for nitrile butadiene latex production, a chemical working toward obtaining GreenRE The state’s ability to attract significant foreign direct
recycling plant for plastics and the development of a new biorefinery. certification for its industrial projects, investments and establish an independent data centre
Desa 27 and Desa 100, reinforcing its ecosystem underscores its growing appeal to global players.
Senai Airport City Sdn Bhd (SACSB) has entered into a sale and purchase commitment to sustainable growth. These developments highlight Johor’s readiness to lead
agreement with Chenbro Malaysia Sdn Bhd, a subsidiary of Taiwan-based In November 2024, the developer Southeast Asia in sustainable industrial innovation.
Chenbro Micom, for approximately 15.1 acres of industrial land within the Senai began construction of Desa 27 in
Airport City Free Industrial Zone. While financial details were not disclosed, Desa Cemerlang. This project spans Looking ahead, Johor’s industrial property market is
SACSB has announced plans to launch Phase 3 of the industrial park, spanning 27 acres of freehold industrial land poised for sustained growth, bolstered by its commitment
350 acres, in 2025. Final negotiations are underway with high-value foreign direct and comprises five plots of detached to sustainability, the development of high-tech ecosystems
investment prospects. factories. Companies such as Hunter and strategic infrastructure projects. However, challenges
Amenities International and Meiban such as high water and energy consumption present
Johor Corporation (JCorp), through its subsidiary JLand Group (JLG), has launched Technologies Malaysia have already opportunities for collaboration between the government
new container operations at Tanjung Langsat Port, located in the Tanjung Langsat confirmed their presence in Desa 27. and private sector. Addressing these issues could involve

14 15
 PENANG The reclamation of Silicon Island (formerly known as Penang
Notable Industrial Transactions in Penang, 2H2024
South Island), a 2,300-acre project off the southern coast of
Industrial Market Activities Penang Island, is progressing steadily. As of August 2024,
Development Penang Science Park North Bukit Minyak Industrial Park Bukit Minyak Industrial Park
40 acres have been reclaimed since work began in September
Penang’s industrial sector witnessed significant 2023. The first factory is scheduled for construction in 2026, Location Mukim 13, Seberang Perai Tengah Mukim 13, Seberang Perai Tengah Mukim 13, Seberang Perai Tengah
milestones in 2024, marked by the launch of major with operations expected to commence in 2027. Designed
projects and innovative initiatives aimed at driving to comply with Environmental, Social and Governance Land Area 7.8 acres 1.5 acres 1.4 acres

growth and sustainability. (ESG) standards, Silicon Island dedicates 40% of its land 60-year leasehold 60-year leasehold
Tenure 60 years leasehold
to infrastructure, open spaces and blue-green corridors. expiring on 19 May 2068 expiring on 3 May 2069
On 28 October 2024, Suling Hill Development Sdn Bhd, Approximately 30% of the island will be dedicated to a
A three-storey office building with a
a joint venture between AME Elite Consortium Bhd and 700-acre Green Technology Park, promoting sustainable Component A parcel of industrial land A parcel of industrial land
single storey open-sided factory
Majestic Gen Sdn Bhd, officially launched Northern development. The full reclamation is anticipated to be
TechValley @ BKE in Seberang Jaya, Penang. Spanning completed by 2032, with the entire development projected to Consideration RM22.5 million RM9.2 million RM7.6 million
176 acres with a development value of RM1.3 billion, span 25 years. Purchaser / Easy Pack Machinery Sdn Bhd Rapid Growth Technology Sdn Bhd Rapid Growth Technology Sdn Bhd
this industrial park is designed to cater to high-value Buyer (A subsidiary of EPB Group Berhad) (A subsidiary of RGT Berhad) (A subsidiary of RGT Berhad)
industries and incorporates advanced infrastructure On 7 December 2024, Penang officially launched the
Vendor / Seller Penang Development Corporation Permai Gas Sdn Bhd Permai Gas Sdn Bhd
and sustainable features. It offers high-speed fibre-optic “Silicon Design @5km+” initiative at Eastin Hotel. This
internet, recreational facilities such as a sports hall project aims to establish a comprehensive ecosystem for Sources: News articles / Bursa Malaysia / Knight Frank Research
and managed workers’ accommodations. Sustainable Integrated Circuit (IC) design and technology enterprises
elements include reflective glass to minimise heat within a 5km+ radius of the Bayan Lepas Industrial Park.
transmission, translucent sheets for natural lighting and Market Outlook Additionally, improved public transportation projects, such as
solar photovoltaic panels to enhance energy efficiency. Key components of the initiative include: the upcoming Penang LRT Mutiara Line and the Juru-Sungai
Northern TechValley @ BKE aims to attract top companies 1. Penang IC Design & Digital Park @ Bayan Lepas: The industrial market in Penang is projected to sustain its Dua Elevated Highway, will enhance intra-state connectivity,
from sectors such as semiconductors, electronics, medical Approximately 1 million sq ft of premium office space growth momentum in 2025, driven by substantial foreign reduce traffic congestion and improve accessibility to key areas.
technology and logistics. The project is expected to be designed for IC design, R&D and digital companies. and domestic direct investments and the development of
completed by 2029. 2. Penang Chip Design Academy @ PSDC: A Chip Design new industrial parks by both public and private entities. This An increasing emphasis on sustainability is shaping industrial
Talent Cultivation Program launched in May 2024, positive trajectory is further bolstered by transformative developments, with projects like Northern TechValley @
In October 2024, Ideal Property Group launched the Ideal focused on upskilling fresh graduates and engineers in initiatives such as the Penang Silicon Design @5km+ and the BKE adopting green building practices. The integration
Business Hub, a 28 acre freehold industrial park located engineering-related fields. development of Silicon Island, which are set to strengthen of renewable energy sources, such as solar power, into
within Penang Technology Park @ Bertam. With 3. Silicon Research and Incubation Space: A one-stop Penang’s position as a global technology hub. These industrial facilities not only reduces operational costs and
a development value of RM260 million, the project centre supporting chip design start-ups and SMEs with projects aim to attract leading technology companies, foster environmental impact but also aligns businesses with global
includes 88 units comprising bungalows, semi-detached workspaces, state-of-the-art facilities, mentorship and innovation and drive demand for high-quality industrial sustainability standards, helping to future-proof operations.
and cluster-type factories. These spaces are designed research capabilities. and R&D spaces, as well as a skilled labor force, significantly
to offer flexible solutions tailored to manufacturers stimulating industrial activity within the state. The continued growth of the manufacturing and logistics
specialising in warehousing, packaging, processing, The initiative offers attractive incentive packages of up to industries, coupled with the rising demand for e-commerce
logistics and light production. Positioned within Parcel RM2 million annually for eligible companies over three The planned expansion of Penang International Airport fulfillment, is driving demand for industrial land and
2 of the expansive 880-acre technology park, the years, coupled with a governance structure to oversee (PIA) is set to boost passenger and cargo capacity, reinforcing buildings.
Ideal Business Hub aims to foster a complete business implementation. Penang’s position as a regional aviation hub. This enhanced
ecosystem with seamless access to supply chain networks. connectivity is anticipated to attract more businesses and Stable asking prices and rental rates for industrial properties
Construction is set to begin in November 2024, with Notable announcements related to the expansion and new investments to the region. further reflect strong underlying demand and market stability.
completion targeted for 2026. set-up of industrial facilities in Penang during the review
period are summarised in the following table.

Notable Expansion / New Industrial Facilities in Penang, 2H2024

Bayan Bandar
Perai
Lepas Cassia
Location Batu Kawan Industrial Park Penang Science Park Valdor Industrial
Free Trade Technology
Zone
Zone 4 Park

Relocation and
Status New Facility New Facility Expansion New Facility New Facility New Facility Expansion Expansion
expansion

78,000 sq ft 888,000 sq ft
560,000 sq ft
Component (Land area: 25,500 sq ft 86,000 sq ft (Land area: 320,000 sq ft N/A 620,000 sq ft N/A
(20.0 acres)
2.1 acres) 28.0 acres)

Status /
Newly Newly Newly Newly Newly Newly Newly
Expected 2025 2027
Completed Completed Completed Completed Completed Completed Completed
Completion

Amphenol DC
RIGOL Nefab Benchmark Equalbase
Enovix Electronics
Vendor Technologies (Malaysia) Electronics (M) Dexcom Development Elna PCB Plexus Corp
Corporation Malaysia
Malaysia Sdn Bhd Sdn Bhd Pte Ltd
Sdn Bhd

Country of
China Sweden United States United States United States United States Singapore Taiwan United States
Origin

Facility
Manufacturing Manufacturing Manufacturing Manufacturing Manufacturing Manufacturing Warehousing Manufacturing Manufacturing
Specialty

Sources: News Articles / Knight Frank Research

Note: N/A refers to not available

16 17
 SABAH SARAWAK development objectives. This collaboration will focus on green transition projects Market Outlook
and provide financial resources to SEDC Energy’s supply chain, bolstering the state’s
Industrial Market Activities Industrial Market Activities renewable energy ambitions. Sarawak’s industrial sector is poised
for significant growth, supported by
During the review period, Kibing Group announced plans to invest RM7.2 billion in a Sarawak is positioning itself as a Transaction Volume and Value of Industrial Properties in the Districts of strategic infrastructure development,
solar glass manufacturing plant in Kimanis, located approximately 40 km south of Kota renewable energy leader in Southeast Kuching, Miri & Bintulu, 1Q-3Q 2023 and 1Q-3Q 2024 a strong focus on renewable energy
Kinabalu. This project was formalised in November through the exchange of two key Asia, driving the region’s transition and increasing investments in key
agreements with state government-linked entities. The first was a sublease agreement to cleaner energy. In 2024, the state Transaction Volume (No. of Units) industries. The state’s strategic
District Y-o-Y Growth
between SBH Kibing Solar New Energy (M) Sdn Bhd, a subsidiary of Kibing Group and achieved a significant milestone, 1Q - 3Q 2023 1Q - 3Q 2024 location, abundant natural resources
Fokasrama Sdn Bhd, a wholly owned subsidiary of Sawit Kinabalu Group, paving the with 62% of its power generation and supportive government policies
way for the construction of one of the region’s largest solar glass production facilities. mix derived from renewable sources, Kuching 100 160 60.0% provide a solid foundation for
reaching its goal six years ahead of Miri 132 129 -2.3%
sustainable growth. By emphasising
The second agreement was a Heads of Agreement between SBH Kibing and Sabah schedule. Sarawak’s commitment to sustainable development practices,
Energy Corporation Sdn Bhd (SEC) for the supply of 45 million standard cubic feet renewable energy aligns with global Bintulu 52 44 -15.4% energy efficiency and the adoption of
per day (MMSCFD) of natural gas to power the plant. This new facility forms part of decarbonisation trends, emphasising advanced technologies, developers
Total 284 333 17.3%
SBH Kibing’s broader strategy to enhance renewable energy infrastructure in Sabah, sustainable growth and innovative and investors can leverage the
strengthen its competitiveness in the global solar energy market and complement its energy solutions. The state is actively Transaction Value (RM Million) opportunities presented by this
existing operations at the Kota Kinabalu Industrial Park (KKIP). advancing projects in hydropower, District Y-o-Y Growth dynamic market.
1Q - 3Q 2023 1Q - 3Q 2024
solar and other renewable energy
In September, Sabah Ports Sdn Bhd (SPSB) officially transferred the management sources to ensure a stable and clean The expansion of transportation
Kuching 128.62 116.21 -9.7%
and operations of Sapangar Bay Container Port (SBCP) to DP World, a global leader in energy supply. This strategy not infrastructure, including airports,
supply chain logistics, through a joint venture company soon to be renamed DP World only benefits the environment but Miri 65.16 101.63 56.0% seaports and roads, will enhance
Sabah Sdn Bhd. Leveraging DP World’s global network and expertise, the partnership also fosters long-term economic connectivity within Sarawak and
Bintulu 58.72 119.66 103.8%
aims to strengthen Sabah’s role in the global supply chain and position SBCP as a key opportunities, attracts international with neighboring regions. Projects
regional trade hub, particularly within the Brunei Darussalam-Indonesia-Malaysia- investments and strengthens regional Total 252.51 337.49 33.7% such as the Second Trunk Road and
Philippines East ASEAN Growth Area (BIMP-EAGA) region. The collaboration focuses energy networks. the construction of strategic bridges
Sources: National Property Information Centre (NAPIC) / Knight Frank Research
on enhancing port operations, increasing efficiency, improving terminal capacity and will unlock new areas for industrial
expanding connectivity. Additionally, the partnership seeks to broaden market access Hydropower plays a central development, reduce transportation
for local businesses, particularly small and medium-sized enterprises (SMEs), while role in Sarawak’s ambition to The Sarawak real estate market experienced mixed performance during the first costs and facilitate the seamless
addressing high logistics costs and creating a more resilient and efficient supply chain become a regional renewable three quarters of 2024. movement of goods and services,
network to drive trade and economic growth in Sabah. energy powerhouse. Its extensive further boosting economic activity.
hydropower capacity not only meets In Kuching, the number of transactions rose significantly by 60.0%, reflecting
The table below highlights notable investment announcements in the industrial local electricity demands but also strong demand, though the transaction value fell by 9.7%, suggesting a move Sarawak’s commitment to renewable
subsector as of 2024. positions Sarawak as a significant toward lower-value properties or declining average transaction prices. Improved energy, particularly hydropower, has
energy exporter in Southeast Asia. road and port connectivity has enhanced Kuching’s accessibility, reduced logistics established the state as a regional
The state’s major hydropower plants costs and improved access to regional and international markets, driving higher leader in sustainable energy. The
Notable Industrial Projects in Sabah, 2024
include the Bakun, Murum, Batang Ai demand for industrial properties. development of green hydrogen
and Baleh Hydroelectric Plants. The projects, supported by the state’s
Investor Project Location Investment Value
Baleh Hydroelectric Plant, currently In Miri, the number of transactions decreased slightly by 2.3%, while transaction abundant hydropower resources, is
Sipitang Oil and under construction, is scheduled for value surged by 56.0%, reflecting a shift toward higher-value properties driven set to attract significant investments
Esteel Enterprise
Sabah Sdn Bhd
Green steel project Gas Industrial Park RM20 billion completion in 2026. Furthermore, by ongoing offshore energy projects, petrochemical facilities and gas processing and foster opportunities in related
(SOGIP)
hydropower supports the production developments. industries. This transition to a low-
SBH Kibing Solar of green hydrogen via electrolysis, carbon economy will drive demand
Solar glass
New Material (M) Kimanis RM7.2 billion contributing to Sarawak’s renewable Rising demand is likely to prompt developers to plan more industrial schemes to for energy-efficient technologies
manufacturing plant
Sdn Bhd
energy ecosystem. meet market needs. Meanwhile, in Bintulu, the number of transactions declined by and sustainable practices across
Tex Cycle 15.4%, yet the transaction value increased significantly by 103.8%, reflecting a rise the industrial sector, reinforcing
Integrated scheduled Sipitang Oil and
Technology (M) Bhd Sarawak is also making strides in in high-value property deals or large-scale projects. The expansion of Samalaju Sarawak’s role as a hub for sustainable
waste management Gas Industrial Park RM100 million
& Evolusi Bersatu
Sdn Bhd
facility (SOGIP) green hydrogen integration. During Industrial Park and ongoing infrastructure improvements are expected to further industrial growth.
the Asia Pacific Green Hydrogen boost both transaction values and volumes in the area.
Sources: Malaysian Investment Development Authority (MIDA) / Knight Frank Research Conference 2024, SEDC Energy
Notes: Sdn Bhd signed a Memorandum Key industrial developments include the 54-acre Rembus Depot in Kota
(1) The integrated clinker and cement plant and the integrated scheduled waste management facility are
currently under construction. of Understanding (MoU) with ICE Samarahan, part of the Kuching Urban Transportation System (KUTS) project,
(2) The green steel project is currently undergoing preliminary assessments for its project site.
Petroleum to develop a hydrogen which is set to be completed by the end of 2025. Featuring a feeder bus depot,
production plant and refueling a hydrogen production plant, a stabling yard and refueling facilities, this
Market Outlook stations at the Rembus Depot. These development is expected to drive demand for industrial properties to support
facilities will support the Kuching operations and maintenance.
Sabah’s industrial sector is poised for sustained growth, leveraging its strategic Urban Transportation System (KUTS)
location as a gateway between Southeast Asia and the global market, with close project, integrating green hydrogen In Miri, Mitsubishi, Black & Veatch and Petros are collaborating on a 500MW
proximity to major shipping routes and neighboring BIMP-EAGA regions. To into the state’s transportation Combined Cycle Gas Turbine (CCGT) power plant, scheduled for operation by 2027,
maintain this momentum, consistent efforts by relevant authorities are essential infrastructure and advancing which will co-fire fuel with up to 30% hydrogen. This project supports Sarawak’s
to enhance basic infrastructure and identify new areas capable of accommodating Sarawak’s green energy agenda. sustainable energy goals and strengthens energy security. Additionally, the state is
large-scale industrial developments. exploring Ocean Thermal Energy Conversion (OTEC) technology off the coast of Miri,
In addition to its local initiatives, with the potential to generate up to 10 gigawatts of renewable energy.
Sarawak is forming strategic
partnerships to further its renewable In Bintulu, Petroleum Sarawak Berhad (Petros) has signed an MoU with Sarawak
energy goals. UOB Malaysia has signed Petchem to establish an ammonia and urea plant, focusing on producing low-
an MoU with SEDC Energy to support carbon ammonia and urea to cater to the growing demand for eco-friendly
Sarawak’s economic and sustainable industrial solutions and fertilizers.

18 19
 MARKET KLANG VALLEY

INDICATIONS
Supply and Demand

OFFICE
The Klang Valley’s office supply currently totals 118.3 million
sq ft, boosted by the recent completion of the Atwater
Corporate Towers in 2H2024. Located in Seksyen 13, Petaling
The Malaysian Institute of Economic Research Jaya, this development marks the first addition to the

MARKET
(MIER) reported a significant improvement in Selangor submarket since 2022. The two office towers,
the Business Condition Index (BCI), which rose offering a combined net lettable area (NLA) of 367,000 sq ft,
to 104.9 points in 3Q2024, up from 86.2 points in are part of the Atwater integrated development, which
the previous quarter. This upward trend reflects includes residential and commercial components. These
growing optimism in the business environment, green-certified towers, holding a GreenRE Bronze
driven by stronger sales performance, better certification, comply with Malaysia Digital (MD) status
capacity utilisation, increased investment activities requirements, ref lecting a focus on sustainability and
and improved employment conditions and wage modern business needs.
efficiency. These positive indicators are expected
to bolster demand for office spaces as businesses The first half of 2025 is set to see the completion of four
expand and optimise their operations. additional office buildings, contributing approximately
1.6 million sq ft of space to the Klang Valley office market.
These projects include The Exchange TRX Office by
Lendlease and Oxley Tower in Kuala Lumpur (KL) City,
TNB Gold Bangsar in the KL Fringe and Sunway Square
Corporate Tower 2 in Selangor.

Atwater Corporate Towers

Source: Paramount Property

The office market continues

to evolve, with occupiers During the review period, occupancy rates in the Klang
Valley displayed mixed performance. In 2H2024(p), KL
prioritising flexible layouts, City and KL Fringe recorded incremental improvements,
green-certified buildings with occupancy rates rising to 67.5% and 87.2% respectively,
and strategic locations. compared to 65.7% and 85.6% in 1H2024. The increase in
these submarkets was likely driven by tenant relocations
While new supply enters the to prime spaces, renewed leasing activity and business
market, rising occupancies expansion, spurred by improving business sentiment and
and rental rates in prime demand for high-specification office buildings.
locations underscore the
Conversely, Selangor experienced a slight decline in
growing demand for quality occupancy, moderating to 74.4% in 2H2024(p) from 75.5%
office spaces. in 1H2024. This decrease may be attributed to the addition
of new supply, temporarily increasing vacancy levels as the
market absorbed the new inventory.

21
 Cumulative Supply and Average Estimated Occupancy Rate In the co-working space segment, Selected Notable Tenant Movements, 2H2024 RM6.50 to RM7.80 per sq ft. The Old CBD, on the other
of Office Buildings in Klang Valley, 2019 to 2024 (p) WORQ expanded its Menara UOA hand, offered more competitive rates, ranging from RM5.00
Bangsar outlet in partnership with Approx. Space to RM7.00 per sq ft. In the KL Fringe, monthly rentals for
Building Name Remarks
(sq ft)
UOA Asset Management Sdn Bhd. similar-grade offices ranged from RM6.20 to RM9.00 per
120.0 80.0%
The expansion added 17,500 sq ft to KL City sq ft. Meanwhile, Selangor offered competitive pricing, with

Average Estimated Occupancy (%)

the existing 15,000 sq ft, creating a monthly rentals between RM5.50 and RM7.50 per sq ft.
Moving In
Existing Supply (million sq ft)

112.5 75.0% total co-working space of 32,500 sq

• Telecommunications sector
ft. Impressively, the space achieved Exchange 106 ~142,000
• Software and business
100% occupancy a month prior to solutions company Gross Asking Rentals of Selected Prime A+ and
105.0 70.0%
the expansion launch, with tenants Moving In (Relocation)
Grade A Office Building in Klang Valley, 2H2024 (p)
including venture capital firms Artem • Banking and financial
Plaza Conlay ~180,000 Gross Asking Rental
services Building Name
97.5 65.0% Ventures Sdn Bhd and Antler, funding • Oil and gas industry (RM per sq ft / month)
agency Cradle Fund and tech giant
Moving In KL City
Alphabet Inc. Additionally, WORQ Integra Tower ~24,000 • Co-working and flexi space
90.0 60.0%
2019 2020 2021 2022 2023 2024(p) opened WORQ Intermark at Integra provider New CBD
Tower, Jalan Tun Razak, a 24,000 sq KL Fringe
Existing Supply (million sq ft) Average Estimated Occupancy (%) The Exchange 106 13.00 – 15.00
ft facility developed in collaboration
Source: Knight Frank Research with Retirement Fund Inc (KWAP). Moving In (Relocation)
Note: (p) = preliminary data Gardens North • Banking and financial Integra Tower 9.80 – 11.00
This new space reported a 96% ~79,000
Tower services
occupancy rate upon launch. • Employment agency Menara Maxis 8.80 – 12.00
Notable Office-Related Announcements The MET Moving In (Relocation) Menara Prudential @ TRX 8.50
Another notable highlight in the Corporate ~19,000 • Healthcare and medical
Tower technology
During the review period, the Klang Valley office market experienced a surge market is the listing of Menara PJD Menara Binjai 7.50 – 7.80
in office openings from AI and tech-related businesses, reflecting the growing for RM289 million, equivalent to Menara UOA Moving In
~17,500 • Co-working and flexi space Menara TCM 7.50
influence of the AI and technology sectors. This trend is bolstered by key approximately RM650 per sq ft. This Bangsar
provider
government initiatives, such as the launch of the KL20 Action Paper earlier 28-storey freehold office building, Plaza Conlay 7.50 – 8.50
Menara Allianz Moving In (Relocation)
this year, the establishment of Malaysia’s National AI Office and significant developed by PJ Development ~10,000 • Information technology (IT)
Sentral NAZA Tower 7.00 – 8.00
investments by major tech players, positioning Malaysia as an emerging regional Holdings Bhd (PJD), is situated on services

hub for AI and innovation. Notable office openings in this sector include: Jalan Tun Razak, Kuala Lumpur. Selangor G Tower 6.50
Spanning a total size of approximately
Mercu
• SAS Institute, a global leader in data and AI, established its new regional office 445,000 sq ft and being fully Moving In (Relocation) Old CBD
Mustapha ~32,000
at Menara IQ, Persiaran TRX, Kuala Lumpur. tenanted, the building underscores its • Education sector
Kamal
Menara AIA Cap Square 6.00 – 7.00
• FPT Software, a global IT corporation, launched its second office in Menara strong appeal to investors.
Moving In
Hap Seng 3, Kuala Lumpur. Menara • F&B corporate shared JKG Tower 5.50 - 6.50
~105,000
• Logicalis, a provider of IT solutions and managed services, inaugurated a new The recent Budget 2025 introduced CelcomDigi services
• Financial services industry Menara Great Eastern 2 5.00
office in Kuala Lumpur along with a service delivery centre in Cyberjaya to several measures relevant to the
enhance its APAC operations. office market. Tax incentives for Source: Knight Frank Research
KL Fringe
• BlackBerry Ltd set up its Asia Pacific cybersecurity headquarters in Cyberjaya, flexible working arrangements are
Selangor, strategically positioning itself near emerging tech hubs and key expected to reshape office demand as Menara Shell 8.50 – 9.00
government infrastructure. This move aligns with BlackBerry’s regional companies increasingly adopt hybrid Prices & Rentals
Menara Southpoint 8.50
expansion strategy and follows its landmark partnership with the Malaysian work models, creating opportunities
government in late 2023. for innovative office design and During 2H2024, all submarkets in the Klang Valley office The Gardens North & South Towers 8.00
space usage. Furthermore, initiatives sector recorded positive movements in rental rates, with
Mercu 2 7.50
The Klang Valley continues to attract multinational corporations (MNCs) seeking to repurpose vacant government- growth rates varying across locations due to differing
to strengthen their regional presence, driven by robust market demand and owned properties into preschools, market dynamics. NU Tower 2 7.00
strategic growth objectives. Notable developments include: daycare centres and training facilities
represent a strategic approach to In KL City, average rental rates rose to RM6.64 per sq ft per Menara Etiqa 7.00 – 8.00
• ArcBlue, a subsidiary of Bain & Company, launched its new Kuala Lumpur maximising existing resources. month (1H2024: RM6.58), driven by sustained demand for
Menara Ken @ TTDI 6.50
office to address growing demand in the Malaysian market and expand its These measures may indirectly newer, well-located Grade A offices and a gradual recovery
Asia Pacific operations. reduce competitive pressures in the in leasing activity among multinational tenants. UOA Corporate Tower A 6.20 – 7.60
• Inverto, a Boston Consulting Group (BCG) subsidiary specialising in commercial property market by
Selangor
procurement and supply chain management, established a new office in Kuala alleviating overall vacancy levels. The KL Fringe submarket experienced a modest increase,
Lumpur to support its regional operations. with average rental rates edging up to RM5.78 per sq ft per 1 First Avenue 7.00
• Wego, a leading travel app and the largest online travel marketplace in the month (1H2024: RM5.75). This growth was supported by
MENA region, opened its new Kuala Lumpur office as part of its broader stable demand in established commercial hubs offering Imazium @ Uptown 6.50 – 7.00
Asia expansion strategy. competitive rents and excellent accessibility.
1 Powerhouse 6.50 – 7.00
• E.SUN Bank, a Taiwanese financial institution, set up its Kuala Lumpur
Representative Office at Exchange 106 @ TRX, citing rapid ASEAN economic In Selangor, the office market saw average rents increase Plaza 33 6.50 – 7.50
growth and global supply chain shifts as key drivers for its expansion to RM4.21 per sq ft per month (1H2024: RM4.16), primarily
The Pinnacle 6.30
into Malaysia. due to the addition of new supply, including the recently
• Bin Zayed International Group of Companies (BZI) opened a new office at completed Atwater Corporate Towers in Petaling Jaya. Surian Tower 5.80
Exchange 106 @ TRX as part of its regional growth strategy. The global
investment conglomerate has committed to investing USD 2 billion in Malaysia, Asking rentals for Prime A+ and Grade A office spaces The Bousteador 5.70
targeting the real estate, renewable energy and financial services sectors. during the review period varied by location. In KL City, the
The Ascent @ Paradigm 5.50 – 5.80
New Central Business District (CBD) commanded higher
rates ranging from RM6.50 to RM15.00 per sq ft. Prime Source: Knight Frank Research

A+ buildings in this area were priced between RM8.50 Note: (p) = Preliminary Data
to RM15.00 per sq ft, while Grade A offices ranged from

22 23
Notable Investment Sales and Transactions, 2H2024 Notable Tenant Movements, 2H2024 PENANG
In 2H2024, the Klang Valley office market saw limited Building Approx. Space
Remarks Supply and Demand
Name (sq ft)
investment activity, with only one (1) notable transaction
New Set Up
recorded: the sale of two office floors in Menara Southpoint. ~7,500
• Infrastructure
The supply of purpose-built office (PBO) space on Penang
New Set Up Island increased slightly, rising from 6.9 million sq ft
~1,600
Selected Notable Tenant Movements, 2H2024 • Real Estate in 2Q2024 to 7.1 million sq ft in 3Q2024, driven by the
Relocation completion of Sunshine Tower in Air Itam. This new office
~1,900
Building Approx. NLA Consideration Menara • Construction tower, with a net lettable area (NLA) of 227,600 sq ft, is an
Location
Name (sq ft) (RM per sq ft) JLand New Set Up
~1,700 MSC-compliant building featuring advanced multimedia
• Information Technology
Menara technology, collaborative workspaces, a data centre and
Mid Valley New Set Up
Southpoint 91,676 62,400,000 / 681 ~3,100 a helipad. It is part of the Sunshine Central mixed-use
City • Information Technology
(2 floors) (1)
New Set Up development, which also includes Sunshine Residence -
~2,400
Sources: Knight Frank Research / Bursa Announcement • Legal services a 30-storey serviced apartment tower, HARRIS Sunshine
Notes: (1) IGB Commercial REIT is buying two office floors in Menara Southpoint ~14,000
Expansion Penang - an 18-storey four-star hotel and a 9-storey
MVS North • Co-working Space
from IGB Bhd. The purchased property consists of two office-suite parcels
Tower & Sunshine Mall.
located on Levels 8 and 9, with a combined area of approximately 8,517 square Relocation
meters. Currently leased to a single tenant, the lease agreement will transfer to South Tower ~6,900
• Real Estate
IGB Commercial REIT alongside ownership upon completion of the acquisition. In Seberang Perai, the existing supply of office space remained
The transaction is anticipated to be completed by the first quarter of 2025. New Set Up
~3,000 unchanged at 1.7 million sq ft during the review period.
• Agroforestry
Medini 9
New Set Up
~1,500
Market Outlook • F&B Looking ahead, Penang’s office market anticipates two
~8,900
New Set Up significant additions in 2025: GBS by The Sea in Bayan
Wisma • Co-working Space
The Klang Valley office market is poised for continued recovery, Lepas, offering 294,000 sq ft of NLA and a 34-storey
Sunway Relocation
supported by gradual improvements in rents and occupancy ~25,000 commercial tower at The Light City in Gelugor, which will
• Legal Services
rates. Although these metrics remain below pre-pandemic feature 186,000 sq ft of NLA for office suites along with a
Source: Knight Frank Research
levels, the steady rebound is underpinned by resilient demand four-star hotel.
from both local and international occupiers.
Prices & Rentals
Recent occupier movements highlight the market’s growing JOHOR
appeal, particularly among global companies establishing During the review period, average asking rental rates for office
or relocating shared services office in Klang Valley. This Supply and Demand space in Johor Bahru increased, driven by the influx of new
attractiveness is driven by factors such as a thriving occupier Grade A office buildings and improved market sentiment.
ecosystem, the availability of high-specification office spaces, The supply of selected office space in Johor was recorded
access to a skilled workforce and cost-competitiveness, at approximately 7.49 million sq ft as of 2H2024, reflecting Grade A PBOs in Johor Bahru have attracted growing interest
positioning the Klang Valley as a strategic choice for businesses. an annual increase of 15.6% compared to 6.48 million sq from corporate and multinational companies (MNCs),
ft in 2H2023. The market saw the completion of an office particularly those based in Singapore. The cost-effectiveness
On the supply side, 2024 saw the completion of 0.8 million sq building, which added approximately 0.55 million sq ft. of these spaces, compared to Singapore’s office market, has
ft of office space, with an additional 1.5 million sq ft expected positioned them as an appealing alternative for businesses.
by 1H2025. While the supply pipeline remains moderate, older Following this increase in supply, the average occupancy
and lower-grade office buildings may benefit from targeted rate for office space declined slightly to 48.1% in 2H2024, Moreover, the increasing popularity of fitted office spaces
upgrades or modernisation to align with evolving tenant a decrease of 2.2% compared to the same period in 2023. offered by some landlords has further fueled demand,
preferences. Such initiatives present opportunities for asset Despite this, the market is increasingly focusing on Grade contributing to the rise in asking rental rates.
repositioning to meet market demands. A office buildings as companies prioritise sustainable and
high-quality spaces. Average Gross Asking Rentals of Selected
Larger floor plates typically around 20,000 sq ft or more are Purpose-Built Office in Johor Bahru, 2H2024
becoming increasingly favoured, particularly in the KL Fringe Notably, Menara JLand’s strategic location near the CIQ and Average Gross Average Gross
and Petaling Jaya areas. These locations are highly attractive the upcoming RTS Link station has generated heightened Locality Asking Rental, Asking Rental, Trend
1H2024 2H2024
due to their robust amenities and excellent connectivity, interest. The building has observed a rise in occupancy, (RM per sq ft / month) (RM per sq ft / month)
including proximity to train stations. Upcoming developments particularly from construction companies and professional Johor Bahru
2.90 – 3.50 3.20 – 3.60
such as The Exchange TRX Office by Lendlease and Sunway service businesses, further underscoring its appeal. City Centre
Square Corporate Tower 2, both slated for completion in Johor Bahru
2.90 – 3.10 2.90 – 3.20
1H2025, are projected to generate significant interest. These City Fringe
Sunshine Tower
projects offer expansive floor plates exceeding 20,000 sq ft and Iskandar
Cumulative Supply and Average Estimated Occupancy Rate Source: Crimson Omega Sdn Bhd
are strategically located to meet tenant demands. Puteri & 2.80 – 3.20 3.00 – 3.30
of Selected Purpose-Built Office in Johor Bahru, 2019 to 2024 Medini
The average occupancy rate of office buildings on Penang
The Tun Razak Exchange (TRX) continues to thrive as Source: Knight Frank Research Island experienced a slight decline of 3.3%, dropping from
8.0 54%
Existing Supply (million sq ft)

a financial hub, supported by its integrated shopping mall and 85.5% in 2Q2024 to 82.7% in 3Q2024, primarily due to the
Occupancy Rate (%)

seamless MRT connectivity. Meanwhile, the Sunway Square 6.0 52% Market Outlook addition of Sunshine Tower. In contrast, Seberang Perai
development, featuring a mix of office spaces, a retail mall, recorded a modest increase, with the average occupancy rate
a performing arts centre and an educational institution, is 4.0 51% In Johor Bahru, Grade A office spaces are expected to rising by 2.0%, from 55.7% in 2Q2024 to 56.8% in 3Q2024.
expected to become a vibrant hotspot upon completion. remain a highly sought-after option for new tenants.
2.0 49% Factors such as lower rental rates, reduced operational In George Town, average occupancy rates for monitored
Investment activity in the sector is anticipated to remain costs, potential incentives from the Johor–Singapore office buildings ranged between 80% and 100%.
0 47%
cautious amid broader economic uncertainties and shifting 2019 2020 2021 2022 2023 2024 Special Economic Zone (JSSEZ) and a lower cost of living Meanwhile, select premium-grade office buildings outside
tenant preferences. However, prime assets with strong tenancy make Johor Bahru an attractive location for Singaporean George Town, such as Menara IJM Land in Jelutong,
Existing Supply (million sq ft) Occupancy Rate (%)
profiles and strategic locations are well-positioned to attract companies. Consequently, older office buildings may Suntech @ Penang Cybercity, GBS@Mahsuri and GBS@
long-term investors seeking stability and growth opportunities Source: Knight Frank Research undergo repurposing or refurbishment to cater to the Mayang in Bayan Baru, reported notably high occupancy
in the Klang Valley office market. growing demand for modern, high-quality office spaces. levels, ranging from 90% to 100%.

24 25
Notable office-related announcements SARAWAK The commercial property market
in Sarawak is positioned for steady
Hong Leong Bank has reopened its iconic Light Street Commercial Property Market growth, supported by robust tourism
branch, reaffirming its commitment to delivering activity, strategic infrastructure
personalised banking services in Penang. Additionally, In 2024, Sarawak recorded a significant milestone in its tourism sector, achieving developments and rising investor
KLS Martin, a renowned century-old medical device 4.08 million visitor arrivals - a 25.0% increase compared to 2023. This surge confidence across key cities like
manufacturer, has established a new service centre in MWE generated an estimated RM10.27 billion in revenue, reflecting a 27.3% rise from the Kuching, Miri and Bintulu. The
Plaza. This facility supports regional sales, service and RM8.07 billion recorded the previous year. The growth is largely attributed to a integration of TODs and smart
biomedical engineering activities, including the design of series of events, conventions and meetings hosted across the state. The increased infrastructure projects are expected
medical implants. tourism activity has driven demand for hotels, resorts, serviced apartments and to enhance Sarawak’s attractiveness
retail spaces such as shopping malls, dining establishments and souvenir outlets, for both domestic and international
Making its debut in Penang, INFINITY8, a prominent co- creating opportunities for further investments in commercial properties. commercial property investments.
working space provider, has launched INFINITY8 Reserve
George Town. This new facility occupies a 25,000 sq ft Notable developments include the Neu Pendington project, a joint venture between Market Outlook
heritage building on Beach Street, a historically significant UDA Holdings Bhd and Sarawak Economic Development Corporation (SEDC).
location that served as the home of Standard Chartered Located in Pending, Kuching, this integrated development will be completed in Sarawak’s commercial property
Bank for over 87 years. phases between 2026 and 2027, with full operations expected by 2029. The project sector demonstrates resilience,
features 594 apartment units, 190 stratified commercial units and a hotel tower, driven by ongoing infrastructure
Prices & Rental with a gross development value (GDV) of RM496 million. It will also include direct development, investment inflows and
access to the SR12 - Pending (Red Line) Automated Rail Transit (ART) station. sustainability-focused initiatives. The
During the review period, asking rentals for select good- SABAH state’s post-COVID-19 Development
grade office buildings in George Town, Gelugor and Bayan Another key project is Langit Citadines, situated along Jalan Tabuan in Kuching, Strategy (PCDS) 2030 outlines
Lepas remained stable, ranging from RM2.80 to RM6.00 per Supply and Demand a collaboration between Hock Seng Lee and The Ascott Limited. This development ambitious goals, including achieving
sq ft per month. Rental rates varied depending on factors consists of two 27-storey towers housing 64 luxury condominiums and 213 significant GDP growth through
such as location, accessibility and building specifications. As of 3Q2024, the supply of privately-owned purpose- Citadines hotel rooms. carbon trading, hydrogen production
built office spaces in Kota Kinabalu remained stable at and hydropower development. These
Gross Asking Rentals of Selected Purpose-Built approximately 5.2 million sq ft. The occupancy rate showed initiatives are expected to boost
Transaction Volume and Value of Commercial Properties in Sarawak,
Office in Penang, 2H2024 a marginal improvement, increasing to 87.9% compared to demand for commercial spaces across
1H2024Transaction Volume (No. of Units)
Gross Asking Rental 86.9% in 2Q2024. various sub-sectors.
Building Name
(RM per sq ft / month) Transaction Volume (No. of Units)
George Town Prices & Rentals District Y-o-Y Growth The PCDS 2030: Highlights 2023
1H2023 1H2024 report, launched in November 2024,
Hunza Tower 5.00 (1) Privately-owned offices in the Kota Kinabalu Central highlighted significant progress across
Kuching 426 535 25.6%
Menara Boustead Penang 3.30 Business District (KK CBD) and the Southern Fringe multiple sectors. Between 2021 and
recorded higher gross asking rentals, ranging from RM2.30 Miri 130 163 25.4% 2023, Sarawak secured over RM21.5
Menara KWSP 3.00 to RM5.50 per sq ft. In contrast, office buildings in the billion in investments, creating more
Karamunsing area, such as Wisma BSN, offered slightly Bintulu 90 105 16.7% than 11,000 jobs. Key developments
Al-Bukhary Building / WOU 3.60 (2)
lower asking rentals of RM2.00 to RM2.30 per sq ft. include advancements in infrastructure,
Menara Livingston 5.00 (2) Transaction Value (RM Million)
the establishment of renewable
District Y-o-Y Growth
Average Gross Asking Rentals of Selected 1H2023 1H2024
energy hubs, healthcare facilities and
MWE Plaza 2.80
Purpose-Built Office in Kota Kinabalu, 2H2024 education centres. These achievements
Wisma Great Eastern 3.00 Kuching 246.32 323.82 31.5% bring Sarawak closer to its PCDS 2030
Gross Asking Rental aspirations, targeting RM282 billion in
Gelugor Building Name
(RM per sq ft / month) Miri 93.12 100.1 7.5% GDP and a median household income of
Menara IJM Land 6.00 Plaza Shell 5.50 RM15,000 by 2030.
Bintulu 59.48 63.26 6.4%
Bayan Baru Menara MAA 2.55 - 3.45 Sources: National Property Information Centre (NAPIC) / Knight Frank Research
GBS@Mayang 5.50 (2)
Wisma Great Eastern 2.30 - 3.00
GBS@Mahsuri 5.50 (2)
Wisma Sabah 2.50 The commercial property market in Kuching recorded a 25.6% increase in
One Precinct 4.50 (2) transaction volume and a 31.5% rise in value, reflecting strong activity supported
Riverson Suites 3.50 - 4.00
SunTech@Penang Cybercity 4.50 (3)
by local economic growth and infrastructure advancements. Miri saw a 25.4%
Wisma BSN 2.00 - 2.30 increase in transaction volume, with total value rising by 7.5% to RM100.1 million
Source: Knight Frank Research Source: Knight Frank Research in 1H2024 compared to 1H2023, indicating growing investor confidence. Similarly,
Notes:
(1) Passing Rent Bintulu experienced a 16.7% increase in transaction volume and a 6.36% rise in
(2) MSC Status Tier 1 Market Outlook value during the same period, driven by demand for offices, retail centres and
(3) MSC Status Tier 2
hospitality facilities in its expanding industrial sector.
The Kota Kinabalu office market is expected to remain
Market Outlook stable, with both rental and occupancy rates holding steady Transit-Oriented Developments (TODs) are being planned along the Autonomous
due to the absence of new supply entering the market. Rapid Transit (ART) routes, with three locations identified for development. These
The Penang office market is expected to remain stable Government initiatives aimed at enhancing Sabah’s appeal TODs are expected to drive demand for retail and office spaces near ART stations,
in 2025, despite the addition of two new office towers to multinational corporations (MNCs) and international positioning these areas as growth nodes for commercial activity.
contributing a combined 480,000 sq ft of space. While the firms are anticipated to sustain demand for office spaces,
increased supply may place some downward pressure on particularly in prime locations. As the current limited The opening of the Hikmah Exchange Event Centre in August 2023, Sarawak’s
rental rates for older purpose-built office buildings, modern supply of prime office space nears full occupancy, new first smart building, is another significant development. Located at Jalan Haji
and well-equipped office spaces are anticipated to sustain demand for high-quality, strategically located offices may Taha, Kuching, it features two 22-storey office towers, a convention centre
steady demand due to their competitive advantages and emerge, creating opportunities for future development. and commercial spaces. This project is likely to boost demand for commercial
alignment with evolving tenant preferences. properties in nearby areas, particularly in the Satok locality.

26 27
 MARKET KLANG VALLEY

INDICATIONS
Supply & Demand

RETAIL
In 2024, the Klang Valley retail market experienced
significant growth with the addition of well-conceptualised
developments that redefined the region’s retail landscape. Key
Malaysia Retail Sales new entries, including Bloomsvale Shopping Gallery, Elmina

MARKET
Lakeside Mall and 168 Park Mall, collectively increased
The Malaysian retail sector exhibited resilience in the total retail space supply to 70.89 million sq ft. These
3Q2024, posting a growth rate of 3.8%, in line with developments reflect a strategic shift towards integrating
market forecasts. This consistent performance was modern amenities with community-centric and nature-
achieved despite the absence of significant festivals or inspired features to enhance consumer appeal.
national holidays, as consumers maintained spending
on both essential and discretionary goods. Key retail Elmina Lakeside Mall, situated in Shah Alam’s City of
segments, such as convenience stores, personal care, Elmina, offers a net lettable area (NLA) of approximately
food and beverage and fashion, recorded improved 214,000 sq ft. It combines modern design with landscaped
growth. This positive performance was driven by boulevards, water features and al fresco dining areas,
robust domestic demand and increased spending providing a nature-inspired shopping experience. The mall’s
from tourists. However, operational challenges like high occupancy rate underscores strong tenant demand,
rising costs and selective consumer boycotts posed driven by its curated mix of lifestyle, wellness, dining and
substantial obstacles. fashion brands.

The escalating cost of living remains a pressing The newly opened 168 Park Mall, Selayang, which
concern, with elevated retail prices straining household commenced operations in December 2024, has added
budgets and diminishing consumer purchasing power. 235,500 sq ft of Net Lettable Area (NLA) to the market.
Nevertheless, the stable labour market and improving Anchored by Village Grocer, Harvey Norman and The One
wages have provided a buffer, supporting overall Sports Centre, the two-level retail and entertainment hub
spending levels and contributing to the sector’s steady underscores the growing emphasis on neighbourhood-
performance amidst challenging economic conditions. centric developments designed to foster strong community
engagement and convenience. The first half of 2025 is set to
Additionally, the recent appreciation of the ringgit bring notable growth to the Klang Valley retail market, with
against the U.S. dollar, if sustained, could potentially an additional 1.0 million sq ft of retail space anticipated to
benefit the retail sector by reducing import costs and be introduced. This expansion includes the completion of
potentially lowering retail prices for imported goods. two neighbourhood malls designed to meet the increasing
This could strengthen consumer purchasing power and demand for community-oriented retail spaces.
support retail sales growth by mitigating inflationary
pressures.
Existing Retail Supply, 2H2024
Looking ahead, the retail industry is projected to grow
by 4.4% in 4Q2024, buoyed by the Malaysia Year- KL City
End Sale (MYES) and government-related household 13.06 mil sq ft
initiatives such as increased civil servant remuneration (30%)
and cash handouts. This optimistic outlook positions
the industry to achieve a full-year growth rate of 3.9%,
reflecting its resilience and adaptability to evolving
economic conditions. Strategic initiatives and sustained
Malaysia’s retail market consumer demand are anticipated to drive the sector’s
adapts to changing consumer recovery and growth in the coming months.

behaviors, with a growing KL Fringe Selangor

36.61 mil sq ft
emphasis on neighborhood- 20.98 mil sq ft
(52%)
(18%)
centric and experiential
retail spaces. The sector Source: Knight Frank Research

remains resilient, supported

by domestic demand,
government initiatives and
the integration of technology-
driven retail concepts.

29
Incoming Retail Supply, 1H2025 Grocery retailers are also making Notable New Entrants in aggressively growing both locally and Adding a technological edge, Prices & Rentals
significant strides to improve Selected Prime Retail Malls internationally, with plans to enter Sangkaya has partnered with
Kuala Lumpur accessibility and convenience, Singapore and Brunei and diversify Masverse to pioneer a blockchain- In 2H2024, three significant retail
catering to the Klang Valley’s urban Suria KLCC into fast-moving consumer goods enabled community-owned mall transactions took place:
Pavilion Damansara Heights (Phase 2) TUDOR, Laderach Malaysia
population. Village Grocer continues (FMCG). Llao Llao, through its master retail concept, aiming to enhance Tropicana Gardens Mall in July 2024
Damansara Heights | 530,000 sq ft
its strong performance with outlets Pavilion Kuala Lumpur franchise holder Woodpeckers Group, transparency and customer and DPulze Shopping Centre and
Senada Shopping Centre
in Bangsar Village and Pavilion Bukit Louis Vuitton, Fuiyoh! Uncle Roger’s, Urban is preparing for an initial public ownership through tokenomics. This 163 Retail Park (rebranded as Sunway
Revivo, Lam Heung Ling*, Fei Fei Crab
Bukit Kiara | 231,000 sq ft Jalil, while Jaya Grocer expands Restaurant, Siong Tong Gai, CLEF, Café Kitsune, offering (IPO) to fund further growth, initiative positions Sangkaya as a 163 Mall) in October 2024. These
into high-density residential and Maison Guerlain including expanding its brands such leader in adopting blockchain for transactions underscore continued
Selangor pedestrian-friendly hubs, including as ChaTraMue across Malaysia. retail innovation, setting a benchmark activity and confidence in the retail
Mid Valley Megamall
EcoWorld’s Se.duduk D’ Kajang Rightside, Le Labo, KolaBed, Jessanne, for community-driven retail models sector.
Sunsuria Forum @ 7th Avenue Frederique Constant, Lapisan Patisserie,
Setia Alam | 256,000 sq ft project and Gamuda Land’s Cove Shae.co, ChaTraMue, Just Good Coffee, RAEA,
Additionally, Heytea continues to in Malaysia.
Centrum. These expansions reinforce Mothercare & The Entertainer, Diptyque, expand across prime locations, while In July 2024, IOI Properties
National Geographic, Udders, Givenchy
Source: Knight Frank Research the role of grocery retail as a Milk & Barley’s debut at Berjaya Times Despite these dynamic advancements, Bhd announced the acquisition
community-centric pillar in the The Gardens Mall Square features a “fresh daily” bakery challenges persist. Cyberjaya’s of Tropicana Gardens Mall in
The Klang Valley’s retail sector is retail landscape. A Store, flaaah with ONO, TOMS model with additive-free products that Malakat Mall, despite its community- Petaling Jaya for RM680 million
undergoing significant enhancement, resonate with modern preferences. focused concept, will cease operations from Tropicana Indah Sdn Bhd, a
Sunway Pyramid
with key players emphasising lifestyle Entertainment remains a key driver YES 5G Store, Palsaik Korean BBQ, Benjamin
Paris Baguette has solidified its after four years, citing post-pandemic subsidiary of Tropicana Corp Bhd.
elements and curated experiences of innovation, blending technology Barker*, ChezChoux, Torii Teppanyaki, Bread position in the premium bakery struggles. Similarly, closures of The seven-storey mall features
History, H&M Home, Jaya Grocer, Lung Ngen,
to attract local communities and with multi-generational appeal Mr Bean, VCR, Ben’s Cookies, TANYU Grilled segment with its sixth outlet at IOI iconic outlets like Rotiboy in Suria a gross floor area (GFA) of 2.95
broader regional audience. to enhance the retail experience. Fish, Gula Petite, Dandy, Pineyard Café, 108 City Mall. Meanwhile, Hextar Retail is KLCC and GSC’s strategic exits from million sq ft and an NLA of 1.05
Matcha Saro, Art Toys Café by Milolo, Hou Duck,
Golden Screen Cinemas (GSC) at Oga Tea & Dining, Kakatoo, Ra-men Bankara, preparing to launch Tam Jai, a Hong underperforming locations reflect million sq ft, with an occupancy
Sunway Pyramid exemplifies this KL East Mall demonstrates this Sanrio Gift Gate Kong noodle chain, by 2025 to target the industry’s need to adapt to rate of 77%. Strategically located, it
trend with its Oasis extension, a with its eight halls, including an One Utama the fast-casual dining market. changing consumer behaviours and is directly connected to the Surian
300,000 sq ft addition featuring over IMAX screen and a family-friendly Beacon Mart, Decathlon, Lovns Coffee, Coffee economic realities. MRT station and accessible via
Meets Pastry by Zus, Rich Baker, Mee Tarik
100 brands, including Malaysia’s Playpark. Meanwhile, Atria Shopping Faizal Kong, W.P.S Café, Anta Superstore, Jynns, Convenience store chains are also four major highways, enhancing its
largest MUJI outlet, H&M Home and Gallery is set to debut a 60,000 ilike&yogurt in a can, Cheevit Cheeva, Mil Toast seeing significant growth, with Notable Retailers’ appeal as a prime retail destination.
House
the region’s first Caudalie Spa. These sq ft theme park in collaboration emart24 planning 17 new branches Expansion Plans This acquisition aligns with IOI
offerings are further complemented with PeopleUp, offering physical, The Exchange TRX in Malaysia’s East Coast region by the Properties’ broader strategy to
Rado, Golden Goose*, Descente*, Upper Palace, ChaTraMue
by the European-themed Jaya Grocer, mental and sensory stimulation to Shae.co, Gu On, Cartier, Undefeated,
end of 2024 to cater to demand for strengthen its presence in the retail
Nationwide
emphasising the importance of cater to families. Such initiatives Dr Martens, Tudor, Vivaia*, Zenith* halal Korean street food and drinks. 40 stores in 2024 sector within the Klang Valley,
experiential retail in drawing foot underscore the strategic integration Source: Knight Frank Research Meanwhile, 99 Speedmart aims to grow HWC Coffee
leveraging the mall’s strategic
traffic. Similarly, Coach Play APW of entertainment in creating Note: *Represents the brands’ maiden entry into
its network to 3,000 outlets by 2025, Nationwide location and connectivity.
in Bangsar integrates retail and destination appeal and extending Malaysia following its Bursa Malaysia listing, 85 stores in 2024
hospitality with features like a Coach consumer dwell time. while competitor KK Mart revisits its 99 Speedmart In October 2024, KIP Real Estate
Coffee Shop and screen-printing International and regional brands IPO plans to strengthen its position. Nationwide Investment Trust (KIP REIT) secured
services, appealing to younger, Retailers are also diversifying are making significant inroads into 250 stores in 2024 shareholder approval to acquire
experience-driven consumers. ZUS their offerings to create unique Malaysia’s retail market. Tim Hortons The fashion and lifestyle segments emart24 DPulze Shopping Centre in Cyberjaya
Nationwide
Coffee at 1 Utama Shopping Centre experiences and foster community marked its entry into Southeast Asia are evolving in parallel. Padini is for RM320 million. This represents
17 stores in 2024
further highlights this narrative with engagement. CzipLee Bangsar with its first two stores in Kuala refurbishing nine stores, opening KIP REIT’s largest acquisition since
7-cafe format stores
its flagship “Coffee Meets Pastry” Village II has doubled its space Lumpur and plans to expand to 100 four new outlets and investing in its listing on Bursa Malaysia in
Nationwide
concept, blending artisanal coffee to include areas for workshops, outlets across the region by 2025. automation to streamline inventory 212 stores by 2024 (1) 2017. The seven-storey mall, located
and pastry artistry within a visually pop-ups and collaborative events, Similarly, KKV launched its global management. Meanwhile, TGI Fridays KKV
in Cyberjaya’s prime commercial
engaging space. blending tradition with modernity. flagship store in Kuala Lumpur and Malaysia remains unaffected by its US Nationwide district and near the MRT Putrajaya
Similarly, MPH Bookstore’s new aims to open 10 outlets by year-end parent’s bankruptcy, progressing with 10 stores in 2024 line, is fully tenanted and offers
The emphasis on experience-driven outlet at Alamanda Shopping Centre while introducing its sister brands, new openings in Mid Valley Megamall, Pos Shop an NLA of 0.31 million sq ft. The
retail extends to flagship store emphasises a refreshed, family- THE COLORIST and X11. Singaporean the reopening of its Sunway Pyramid Nationwide acquisition supports KIP REIT’s
transformations, where spaces focused design with enhanced retail brand OH!SOME also debuted outlet in December 2024 and a new 33 stores in 2024 strategy of focusing on community-
are being modernised to enhance accessibility and customer in Malaysia, establishing a presence outlet launch in Putrajaya planned for Source: Knight Frank Research centric neighbourhood malls and is
customer engagement. Toys“R”Us experiences. in Johor Bahru, Perak and recently the first half of 2025. Note: (1) mainly through converting existing stores expected to strengthen its position in
Malaysia’s revamped flagship at in Kuala Lumpur, where it occupies the retail market.
Mid Valley Megamall introduces The Klang Valley retail sector a 14,000 sq ft space, reflecting the Hybrid retail models are reshaping the
a 5,500 sq ft Kiztopia Club with continues its dynamic growth growing demand for lifestyle-focused sector, blending traditional formats
18 interactive zones for children, trajectory, driven by strategic variety stores. with modern convenience. Lotus’s
merging retail and play. Metrojaya’s expansions from global and Malaysia has introduced its first hybrid
redefined flagship store offers a local players. Prime malls are In the food and beverage sector, store at Lotus’s Puchong, catering to
streamlined 30,000 sq ft layout with attracting a curated mix of brands brands are scaling rapidly, leveraging diverse market segments, including
convenience-focused features such to meet evolving consumer innovative strategies to meet rising business operators, Horeca (hotel,
as a cafe, private fitting rooms and a preferences. Established retailers demand. HWC Coffee is expanding restaurant, and cafe) players and
customer lounge. Sports Direct’s first are strengthening their presence, into the East Coast market with its individual consumers, with dedicated
flagship store enhances its appeal leveraging prime locations first store at East Coast Mall, Pahang, payment lanes and bulk-purchase
with a 23,000 sq ft space showcasing and diversified offerings. This in November 2024, while continuing options. Similarly, Pos Malaysia Berhad
concepts like gait analysis in its adaptability underscores the its commitment to community has embraced the “Shop in Shop”
Running Concept, product education resilience of the Klang Valley’s retail initiatives through corporate social concept, integrating postal services
in its Outdoor Concept and a Fitness landscape, solidifying its role as responsibility (CSR) programme. ZUS with retail convenience and small and
Studio for women’s sports apparel, a key driver of Malaysia’s retail Coffee, backed by RM250 million in medium enterprise (SME) partnerships
highlighting the increasing role of sector growth. investment from KV Asia Capital, to enhance service offerings and
technology in retail. KWAP and Kapal Api Group, is modernise customer experiences.

30 31
Also in October 2024, Sunway Real In Selangor, Sunway Pyramid items, such as imported premium Notable New Entrants in Selected
Estate Investment Trust (Sunway commands an average monthly goods, will likely shift consumer Shopping Malls in Johor Bahru,
REIT) Management Sdn Bhd, the gross rental of RM18.00 per sq demand toward cost-effective 2H2024
Manager of Sunway REIT, completed ft, an increase from RM16.00 per alternatives. Similarly, the excise
the acquisition of 163 Retail Park in sq ft in 2022, with an occupancy duty increases on sugar-sweetened Komtar JBCC
Expansion: Antipodean Gold, TeaGarden,
Mont’ Kiara for RM215 million from rate of 98.0%. Meanwhile, The beverages, effective January 2025, Marrybrown
YNH Property. The mall has since Mines remains stable with average and the rationalisation of RON95 New set-up: Richeese Factory
been rebranded as Sunway 163 Mall, gross rentals at RM5.00 per sq fuel subsidies by mid-2025
reflecting its integration into Sunway ft, unchanged from 2022 and an will elevate operational and Sutera Mall
Expansion: HeyTea, Huawei, Liho Tea (1),
REIT’s portfolio. The seven-storey occupancy rate of 80.0%. transportation costs, prompting Watsons
mall boasts a 99% occupancy rate retailers to revise pricing strategies
and an NLA of 0.25 million sq ft, While there are no new updates and optimise supply chains. Paradigm Mall Johor Bahru
on 2024 rental performance due to Expansion: Oriental Kopi (1)
housing over 100 tenants and brands,
New set-up: Escape Challenge Park, KKV
making it a prominent retail asset the timing of annual reports being The Klang Valley retail market is
in the Mont’ Kiara area. Immediate released, these figures provide an witnessing significant supply growth. Sunway Big Box Retail Park
plans include improving maintenance insight into the resilience and stability Developments such as Bloomsvale Expansion: Subway
New set-up: Jungle Gym, Laser Tag
and traffic circulation to enhance the of retail assets in the Klang Valley, Shopping Gallery, Elmina Lakeside
shopping experience. Longer-term particularly for prime and well- Mall and 168 Park Mall exemplify a The Mall, Mid Valley Southkey
strategies aim to optimise the tenant located malls. Tenants continue to shift toward neighbourhood-centric Expansion: MANGO, Regency Specialist
mix and reconfigure floor space, favour malls with established and community-focused retail Hospital
New set-up: HeyTea, MR D.I.Y. Plus
positioning Sunway 163 Mall as a foot traffic and strong branding, spaces. These projects, designed to
premier lifestyle destination in North driving occupancy and rental growth integrate modern amenities with JOHOR Jungle Gym and Laser Tag, reinforcing AEON Mall Tebrau City
Kuala Lumpur. The mall’s strategic in key locations. lifestyle elements, are attracting Johor Bahru’s evolution into a lifestyle- Expansion: Kyochon 1991 (2), Royce (2),
location is further enhanced by the strong tenant interest, reflecting a Supply & Demand centric retail hub. Palsaik Korean BBQ Malaysia
New set-up: Tsutaya Bookstore, Eat Pizza
proposed Sri Hartamas station under Market Outlook sustained demand for curated retail
Malaysia (2), STAR KIDS
the recently revived MRT3 alignment, experiences. As of 3Q2024, Johor Bahru’s Prominent malls like The Mall, Mid
which will significantly improve The retail sector in Klang Valley cumulative retail space supply Valley Southkey are also diversifying Johor Bahru City Square
accessibility upon completion, further remains cautiously optimistic, Investment activity in the Klang remained steady at approximately their tenant mix. The opening of Expansion: Herbal Farmer
increasing the mall’s appeal to supported by government measures Valley’s retail market remains robust, 20.48 million sq ft, unchanged Regency Medical Care Centre within
Toppen Shopping Centre
shoppers and tenants. aimed at mitigating rising living costs with notable acquisitions such as from 3Q2023. Despite the constant the mall adds a new dimension to
New set-up: JDT Direct Store
and adapting to evolving consumer Tropicana Gardens Mall, DPulze supply, the overall occupancy rate its offerings. Additionally, the mall
These transactions demonstrate preferences. Shopping Centre and Sunway 163 increased by 2.8%, reaching 71.5% has nearly reached full occupancy, AEON Mall Bukit Indah
ongoing confidence in the Mall in 2H2024 reflecting continued in 3Q2024 compared to 68.7% in experiencing sustained demand, Expansion: Uniqlo, Decathlon,
Klang Valley’s retail sector, with Initiatives such as a 30% increase confidence in the sector. These the same period last year. This particularly from Singaporean Oriental Kopi
acquisitions focusing on strategically in cash handout allocations to transactions underscore the focus growth reflects sustained demand shoppers who are drawn to its strategic Larking Junction
located and high-quality assets. RM13 billion through programs on strategically located assets with for retail spaces driven by evolving location and curated retail experiences. Expansion: Jollibee, ZUS Coffee,
Developers and investors continue to like Sumbangan Tunai Rahmah high-quality tenant mixes and strong consumer preferences and strategic MR D.I.Y., Watsons, Burger King
expand and enhance their portfolios, and Sumbangan Asas Rahmah are footfall potential. developments in the region. These developments reflect Johor Source: Knight Frank Research
aligning with evolving consumer enhancing household income and Bahru’s dynamic retail scene, which Notes:
needs and urban development trends. supporting spending on essential Looking ahead, retailers face Key retail destinations such as Sutera continues to evolve by blending (1) Expansion within existing mall / location
(2) Situated within newly established AEON
goods. Complementary measures, a landscape defined by both Mall, Paradigm Mall and AEON Tebrau traditional retail with innovative, Tebrau Food Hall
In the Kuala Lumpur city centre, including Employees Provident opportunities and challenges. City Mall continue to attract a mix entertainment-focused concepts,
iconic malls Suria KLCC and Pavilion Fund (EPF) Account 3 withdrawals, Technological advancements of established and emerging brands, solidifying its appeal to both local and
Kuala Lumpur maintain strong a 13% wage adjustment for civil highlight the potential for innovation, including Oriental Kopi, HeyTea, international consumers.
positions in the market, with average servants effective December 2024 creating avenues to improve Huawei, KKV and Watsons.
monthly gross rentals of RM41.00 and an increase in the minimum transparency, enhance consumer
per sq ft and RM30.00 per sq ft wage to RM1,700 starting February engagement and boost operational A notable addition to the retail
respectively. This represents a modest 2025, are expected to bolster private efficiency. At the same time, evolving landscape is Larkin Junction Mall by
increase compared to 2022 rates of consumption further. These initiatives consumer behaviours, persistent SKS Group, which officially opened its
RM39.00 per sq ft and RM28.00 provide a stable foundation for inflationary pressures and changes doors on 29 November 2024, further
per sq ft. Both malls reported high sustained demand, particularly for in government policies will demand enhancing the diversity of retail Larkin Junction
occupancy levels, with Suria KLCC staple products and essential goods. strategic flexibility and adaptability. offerings in Johor Bahru. Source: SKS Group

achieving 96.0% and Pavilion Kuala Market Outlook

Lumpur at 95.2%, reflecting their Private consumption, the largest Focusing on experiential, community- AEON Tebrau City Mall unveiled its
continued appeal among tenants and contributor to Malaysia’s GDP, centred and technologically AEON Tebrau City Food Hall, featuring Tsutaya Bookstore Johor Bahru’s retail market has
Source: JB City Guide
shoppers alike. remains a key growth driver for the integrated retail formats will be 20 specialty shops, complemented by shown significant improvement,
retail sector. However, inflationary essential for maintaining growth Japan’s renowned Tsutaya Bookstore, marked by higher occupancy rates
In the Kuala Lumpur fringe, Mid pressures continue to challenge and resilience in the Klang Valley’s making its debut in Johor and STAR and increased foot traffic in malls.
Valley Megamall and The Gardens consumer purchasing power, dynamic retail sector. By proactively KIDS, an indoor children’s gym. These Retailers are responding to evolving
Mall continue to command encouraging a shift toward value- addressing emerging challenges and additions underscore the growing consumer preferences by diversifying
average monthly gross rentals of driven consumption. Retailers focused aligning strategies with shifting trend of integrating entertainment their offerings and incorporating
approximately RM18.00 per sq ft, a on essentials and value-oriented consumer priorities, the sector can and retail to provide a comprehensive entertainment and medical elements
slight improvement from RM17.00 offerings are poised to benefit as effectively position itself to capitalise lifestyle experience. Paradigm Mall into mall environments. The retail
per sq ft in 2022. These malls households prioritise necessities. on long-term opportunities. exemplifies this shift with key tenants landscape in Johor Bahru is expanding,
maintain near-full occupancies at such as KKV, China’s leading lifestyle with more brands entering the market,
approximately 99.9%, underscoring The government’s planned expansion retail store and the Escape Challenge supported in part by the strong
their position as key retail of the Sales and Service Tax (SST) in Park. Similarly, Sunway Big Box offers Singapore Dollar, which has driven
Regency Medical Care Centre
destinations in the region. May 2025 to include non-essential family-friendly amenities such as Source: visitJohor increased retail spending in the city.

32 33
 SABAH
Supply & Demand

As of 3Q2024, the retail space supply in shopping complexes, including shopping

centres, hypermarkets and arcades in Kota Kinabalu remained steady at
approximately 6.1 million sq ft. The occupancy rate also remained stable from the
previous quarter, standing at 79.2%.

The average monthly gross rentals in selected shopping malls within the Kota
Kinabalu Central Business District (KK CBD) ranged between RM1.01 per sq
ft and RM28.50 per sq ft. Rental variations were influenced by factors such as
mall location, unit visibility, size, floor level and rental structure, among other
considerations.

During the review period, Imago Shopping Mall commenced renovations to

PENANG Rentals expand its basement level, adding to its retail space. While this expansion
will reduce parking capacity, it is expected to enhance the mall’s overall retail
Supply & Demand The monthly gross rental rates for offerings and improve its competitive positioning within the market.
ground-floor retail spaces in select
As of 3Q2024, the total existing supply of shopping malls in Penang State recorded prime shopping malls within George Notable New Entrants in Selected Shopping Malls in Sabah, 2H2024
a moderate growth of 4.0%, rising from 20.1 million sq ft in 2Q2024 to 20.9 million Town have remained stable, generally
sq ft. This increase was largely attributed to the completion of Sunshine Mall in ranging from RM1.80 per sq ft to
Shopping Mall Retailer Type of Trade Status
Air Itam, which added 820,000 sq ft of net lettable area (NLA) to the market. The RM36.98 per sq ft. These variations
overall occupancy rate declined to 70.5% (2Q2024: 73.1%). However, in George are influenced by factors such as the The Well Cafe F&B Expansion
Town, the overall occupancy improved by 0.6% quarter-on-quarter (q-o-q) to mall’s profile, strategic location and
reach 80.5% (2Q2024: 80.0%), suggesting relatively stronger demand within the the size of individual retail units. VINCCI Fashion Expansion
city’s core retail areas. Samsonite Travel Essentials New set-up
Market Outlook
The Sunshine Mall, part of the Sunshine Central mixed-use development, Mia Beaute Beauty Products New set-up
Imago Mall
achieved its Certificate of Completion and Compliance (CCC) in July 2024. The The retail market in Penang is
MOVON Baby Products New set-up
project includes a 30-storey serviced apartment tower (Sunshine Residence), an projected to remain stable in 2025,
18-storey 4-star hotel (HARRIS Sunshine Penang) and an 18-storey office tower underpinned by several positive Blue Tandoor Restaurant
F&B New set-up
& Grill
(Sunshine Tower). The 9-storey podium mall, offering an NLA of 820,000 sq drivers, including increased
ft, officially opened to the public on the 11 October 2024. Featuring 350 stores, retail spending, the entry of new Shuyi Grass Jelly F&B New set-up
the mall is anchored by the Sunshine Hypermarket, provided a well-rounded brands, expanded flight routes and
shopping destination for daily essentials. frequencies and growth in tourism- Celcomdigi Telecommunication Expansion

related activities. However, the recent Bath & Body Works Beauty Expansion
Suria Sabah
On the horizon, The Waterfront Shoppes Phase 1 is slated for completion on opening of Sunshine Mall in October Shopping Mall
Penang Island. With an NLA of 680,000 sq ft, this shopping mall is part of The 2024 and the anticipated completion Gam Tong F&B Expansion
Light City, a prominent mixed-use development in Gelugor. This addition is of The Waterfront Shoppes Phase 1 HLA Fashion New-set-up
expected to further diversify Penang’s retail offerings and enhance the shopping in 2H2025 are expected to heighten
landscape within the region. competition within the State’s retail Source: Knight Frank Research

sector, particularly on Penang Island.

Notable New Entrants in Selected Shopping Malls in Penang State, This could exert downward pressure During the review period, several notable entrants in the retail sector
2H2024 on occupancy rates and rental levels. strengthened Kota Kinabalu’s market dynamics. Brands spanning travel, fashion,
Gurney Plaza beauty, baby products and food and beverage categories made their mark,
BMF x Svenson, New Balance, Uniqlo (1), Sushi Tei, OFFFFive COFFEE, Miniso, HEYTEA, Le Creuset, contributing to the city’s evolving retail landscape. Positive retail performance
Skechers (2), VS Outlet, Grand senQ, Indie Batik, Ms. Read
also spurred brand expansions and relocations to larger spaces.
Queensbay Mall
Sasa Malaysia (3), Daseo Malaysia (2), Madam Kwan’s, Tudor Watch Boutique, Watches of Switzerland, JO’s
Cha, Polo Ralph Lauren, Switch (3), Dragon-i (3), Bath & Body Works (3), Gloo, 4Fingers Malaysia (3), Crocs (3), Imago Mall welcomed new tenants including Samsonite, an international luggage
Urban Republic (2), Lacoste (2) brand from the United States, alongside Mia Beaute, MOVON, Blue Tandoor
Gurney Paragon Mall Restaurant & Grill and Shuyi Grass Jelly, expanding its appeal with a diverse
Picklemotion, Rituals Cosmetics Malaysia, Urban Living, Rock Life, FrenT, Anovia, HONOR, retail offering. Meanwhile, Suria Sabah Shopping Mall marked the entry of HLA,
Saturday Club
a leading menswear brand from China, further elevating its tenant portfolio and
1st Avenue Mall
Crocodile, FFS Luxury, Energized Sportswear, Jaemi Wonderland, Poney
aligning with market demand.
Sunshine Mall
Urban Living, Maxis, Oppo Brand Store, Samsung Premium Store, A.S.A.P, Opera, Ai-Cha, Bingxue, Market Outlook
Bread History, Bread R Us, daseo, Dragon Noodle, Ghee Hiang, Happy Potato, Hot & Roll, HWC Coffee,
Koong Woh Tong, Leomag Waffle, Light Stone Restaurant, Restoran Sawara, Richeese Factory, Syok Aroi,
Looking ahead, prime shopping malls in Kota Kinabalu are expected to adopt
Tai Ho Jiak, Talk Talk Kopi, Tealive, The Fruit Station, The Grass, WaaWaa Yogurt, S Foodhall, Miniso, Daiso
Japan, MR DIY, Cincin Gold & Jewellery, Dzi Kingdom, Public Watch, ToyRus, Skechers, Space, Sports Direct, strategic measures to optimise operations and strengthen their market position.
Sunshine Hypermarket Key focus areas include filling vacant retail spaces and enhancing tenant mix
Sunway Carnival Mall and performance. By carefully curating a balanced tenant mix that aligns with
Salad Atelier, Cosas United, Loudspeaker, Tomei (2), Vinstella Jewellery (2), Switch, Bayu Somerset, Jo Malone consumer preferences, these malls aim to attract increased foot traffic and drive
London, BebeButterfly, Wah Chan, HEYTEA, Potato Corner, Zui Ma Tou Hot Pot
consumer spending. This strategy is anticipated to contribute to higher turnover
Source: Knight Frank Research
Notes: rents, further reinforcing the financial sustainability of these retail assets.
(1) Expansion
(2) Relocated
(3) Reopened

34 35
 MARKET
INDICATIONS
HOSPITALITY International Tourist Arrivals

MARKET
International tourism has shown remarkable recovery, figures. This aligns with UN projections for a full recovery
reaching 98% of pre-pandemic levels during the first nine by the end of 2024, despite persistent economic and
months of 2024. This growth has been driven by robust geopolitical challenges.
demand in Europe and the reopening of key markets in the
Asia-Pacific region. As of July 2024, the Asia-Pacific region recorded a rapid
rebound in tourism, with arrivals reaching 82% of pre-
The United Nations World Tourism Organization (UNWTO) pandemic levels. This momentum continued, rising to 85%
World Tourism Barometer indicates that approximately in June and further to 86% in July. Sub-regional recoveries
1.1 billion international tourists travelled during this period, included South Asia at 92%, Southeast Asia at 88% and
reflecting an 11% increase from 2023 and just 2% below 2019 Oceania at 83%, highlighting the region’s steady recovery.

Southeast Asia: Recovery of International Tourist Arrivals (2019 to July 2024)

100% 18% 2% 30% 71% 88%

2019 2020 2021 2022 2023 2024

Percentage recovered Percentage not recovered

Source: UN Tourism (September & November 2024)
Notes:
(1) Base Year = 2019
(2) 2024 data are provisional.

Malaysia: Tourist Arrivals and Receipts

Malaysia experienced a robust recovery in its tourism Tourism receipts also surged by 48.8%, generating RM73.3
sector during the first nine months of 2024, aligning with billion compared to RM49.3 billion in the corresponding
the strong rebound in international arrivals reported across period of 2023. This substantial growth underscores
Southeast Asia by UN Tourism. The country welcomed Malaysia’s continued appeal as a key destination in the
18.4 million tourists during this period, marking a 27.0% region, benefiting from increased international travel and
increase compared to 14.5 million arrivals in the same strong market demand.
period of 2023. This upward trend continued, with tourist
arrivals rising by an additional 4.1 million, bringing the
total to 22.5 million as of November 2024.
The hospitality sector is experiencing a
robust recovery, driven by the resurgence Malaysia: Tourist Arrivals & Tourism Receipts (2019 to 3Q2024)
of international tourist arrivals and a 30
86.1
100

strong rebound in domestic travel.

90
25 73.3

Tourist Arrivals (Million)

Tourism Receipts (RM Billion)

80
Strategic infrastructure upgrades,
71.3
70
enhanced connectivity and the opening of 20
49.3 60
new hotels are strengthening Malaysia’s 15 50

appeal as a premier regional destination. 10

26.1 28.2
20.1
40

Additionally, promotional campaigns and 12.7 14.5 18.4

30
20
the growing demand for medical tourism 5
0.2 10.1
10
are further solidifying the sector’s growth, 0
4.3 0.1
0
positioning Malaysia as a key player in the 2019 2020 2021 2022 2023 1Q-3Q 2023 1Q-3Q 2024

global tourism market. Tourist Arrivals (Million) Tourism Receipts (RM Billion)
Source: Tourism Malaysia

37
The aviation sector played a pivotal role in driving Malaysia’s tourism recovery KLANG VALLEY The incoming hotel developments in
the Klang Valley reflect a balanced
during the first nine months of 2024. While passenger movements remained
mix of luxury, premium and economy
slightly below pre-pandemic levels, Malaysia Airports Holdings Berhad (MAHB) Supply & Demand
accommodations, with the majority
reported a 19.4% increase in net profit compared to the corresponding period in
being mid-scale properties featuring
2019, amounting to RM606.2 million. As of 3Q2024, Malaysia’s hospitality market comprised 278,992 hotel rooms across
200 to 400 rooms.
3,555 properties (Source: National Property Information Centre (NAPIC)). The
Passenger traffic across MAHB’s network of airports recovered to 96.3% of pipeline includes 15,363 rooms from 75 upcoming hotels, with an additional 13,832
Klang Valley continues to attract
2019 levels, with 101.2 million passengers recorded during the review period. rooms from 68 planned hotels in various stages of development.
international hospitality brands,
In Malaysia alone, passenger traffic reached 89.5% of pre-pandemic levels, a
demonstrated by notable openings in
notable improvement from 79.3% in the first nine months of 2023. Kuala Lumpur leads the market with 47,177 rooms across 253 hotels and an incoming
2023, such as IHG Hotels & Resorts’
supply of 3,646 rooms from 16 hotels. Selangor and Putrajaya collectively account
debut of Crowne Plaza and Hotel
This growth was supported by enhanced connectivity, with 71 airlines for 217 hotels with 27,858 rooms, though no incoming supply was recorded in these
Indigo and Hyatt Hotels’ first Hyatt
currently operating in Malaysia, surpassing the 69 recorded in 2019 and an areas as of 3Q2024. Planned supply in Kuala Lumpur totals 1,432 rooms from 9
Place in Bukit Jalil. Looking ahead
additional four airlines expected by year-end. Furthermore, the introduction hotels, while Selangor and Putrajaya contribute 470 rooms from 2 hotels.
to 2025, several new hotels will be
of a 30-day visa exemption for tourists from China and India in December `
managed by globally recognised
2023 led to a significant surge in arrivals from these countries in 2024. Kuala Lumpur features a balanced distribution of 3- to 5-star hotels, maintaining the
brands, including Accor Hotel
Between January and August 2024, Malaysia welcomed 2.3 million Chinese highest total number of rooms in each category. Selangor has a strong presence in the
Group, Hyatt Hotels, IHG Hotels &
tourists, marking a 160% increase compared to the same period in the previous 3-star segment, complemented by a notable offering in the 4- and 5-star categories.
Resorts, Kempinski Hotels and Hilton
year. Similarly, as of 1 December 2024, the visa exemption for Indian nationals Putrajaya, in contrast, offers a limited selection of accommodations, primarily in the
Worldwide.
contributed to a 223% rise in Indian visitors, up from 283,885 in 2023. 4- and 5-star segments.

Existing Supply of Hotel Rooms by Star Rating in Klang Valley, 3Q2024 Approximately nine new hospitality
Malaysia: Recent Government Policies, Initiatives and Infrastructure developments, totalling around 3,145
Developments 5-Star 4-Star 3-Star
rooms, are scheduled for completion
State
No. of No. of No. of No. of No. of No. of in 2025. Key projects include:
Hotels Rooms Hotels Rooms Hotels Rooms
Government Policies
Details
and Incentives Kuala Lumpur 36 14,288 41 12,262 36 8,291 Accor’s Expansion with Worldwide
Putrajaya 3 678 3 1,053 0 0 Hotels Group: Accor is strengthening
• Approximately RM550 million allocated to boost tourism through
Selangor 19 6,528 24 7,389 35 5,009 its partnership with Worldwide
cultural events, local arts promotion (e.g., handicrafts and batik) and
marketing campaigns. Hotels Group to launch two new
Sources: National Property Information Centre (NAPIC) / Knight Frank Research
• RM110 million is allocated to upgrade tourist sites, support ecotourism properties in Kuala Lumpur in
Budget 2025 and enhance UNESCO nominations, with global partnerships
1Q2025. These include the debut
emphasising sustainability. Following the trend observed in 2022 and 2023, the majority of new hotel openings
• RM600 million earmarked for restoring landmarks in Kuala Lumpur, of the Grand Mercure brand in
aimed at preserving heritage and strengthening the city’s cultural
and completions in 2024 are standalone, mid-scale, full-service properties with
Malaysia and the addition of an ibis
hub status. capacities exceeding 200 rooms.
Styles hotel. The Grand Mercure,
located between Bukit Bintang and
• By June 2024, further revisions introduced by MOTAC aim to attract Notable hotel openings in the Klang Valley in 2024 include:
high-net-worth individuals (HNWIs) and address concerns over 2021 Chinatown, will feature 325 rooms,
Revamped Malaysia
My Second Home
terms. dining venues, event spaces, a fitness
• The three-tier structure and income requirements established in Kuala Lumpur centre and a pool. The ibis Styles in
(MM2H) Programme
December 2023 remain.
– Three-Tier System Bukit Bintang will offer 168 rooms, a
• The revision now allows individuals aged 25 and above to apply, Development Number
Description
offering greater flexibility for younger applicants. Name of Rooms bar, a laundromat and a fitness area,
Courtyard by
Opened in June 2024 within the Bloomsvale @ OKR development on all conveniently near shopping and
Jalan Puchong, this hotel features 278 rooms, ranging from standard
Infrastructure Marriott Kuala 278 dining hotspots.
Details Lumpur South
to presidential suites. Key amenities include a restaurant, outdoor pool,
Developments fitness centre and 10 event spaces.
Holiday Inn Strategically located at the intersection of Jalan Maarof and Jalan Park Hyatt Kuala Lumpur: Opening
• Launched several initiatives to enhance passenger experience, Kuala Lumpur Bangsar, the property features the new-generation Open Lobby concept, 220
Kuala Lumpur positioning KLIA as more than just a transportation hub. Bangsar seamlessly blending dining, relaxation, work and leisure spaces. in 2Q2025, this hotel will occupy
International Airport • Introduced advanced solutions, including facial recognition Officially opened on 18 December 2024, the 5-star hotel on Jalan Sultan the top 17 floors of Merdeka 118,
(KLIA) technology, self-service bag drops kiosks and an excess baggage Hyatt Centric Ismail is the first Hyatt Centric-branded property in Peninsular Malaysia. A Asia Pacific’s tallest skyscraper. It
postal service to lower luggage delivery costs. City Centre link bridge connects the hotel to Plaza Hap Seng, seamlessly integrating it
312
into the complex. will offer 232 rooms, including 28
• Six airlines resumed narrow-body aircraft operations in August 2024, A 53-storey hotel in the city centre, offering 275 rooms and suites with suites and 30 residential apartments,
Imperial Lexis
marking the return of such operations after 22 years. Kuala Lumpur
private pools. Amenities include an infinity Sky Pool, a 24-hour gym, a 275 designed for an elevated guest
Sultan Abdul SkyDeck with glass floors and a ballroom.
Aziz Shah Airport
• Airlines include AirAsia, Firefly, SKS Airways, TransNusa, Batik Air experience.
Malaysia and Scoot. Located near TRX’s Exchange 106 mall, this boutique hotel opened in April
(LTSAAS) Lloyd’s Inn 2024, providing 110 monochromatic rooms with open-air showers, along
• Part of the Subang Airport Redevelopment Plan (SARP), with Phase 2 110
scheduled to start in three years.
Kuala Lumpur with co-working spaces and meeting rooms, catering primarily to business
Additional openings in 2025 include
travellers.
prestigious names such as Kempinski
• RM1.5 billion expansion project set to complete by 2028, including
Selangor & Putrajaya Hotel Kuala Lumpur, Kimpton
terminal and airside upgrades.
Development Number Hotel Kuala Lumpur, Hyatt Regency
Penang International • Installation of 10 auto gates in international departure and arrival halls Description
Name of Rooms Kuala Lumpur, Waldorf Astoria
Airport (PIA) began in November 2024.
• Upon completion, PIA will become Malaysia’s second-largest airport Conveniently located near Kuala Lumpur International Airport, this hotel Kuala Lumpur, Marriott Executive
after KLIA. offers 229 affordable and stylish rooms, including Biker and Family rooms,
ibis Styles Apartments and Citadines Montfort
Sepang KLIA
with live flight updates. Key amenities include the largest saltwater pool in 229
the area, a fitness centre, spa, dining options and event spaces for up to Shah Alam. These developments
• RM442.3 million upgrade approved, with a project timeline of 48 300 guests.
months starting pre-construction in 2024 and completion by 2027.
reinforce Klang Valley’s status as
Malaysia’s first Moxy hotel, opened in February 2024 near IOI City Mall
Kota Kinabalu • Expansion of the main terminal will increase capacity from 9 million to Moxy Putrajaya and Kuala Lumpur International Airport. With 480 rooms, it features locally 480 a premier hospitality destination,
International Airport 12 million passengers annually. inspired designs, a fitness centre, a pool and dining option.
catering to diverse traveller
(KKIA) • Additional developments include a multi-storey parking facility, seven Opened in September 2024 at KLIA2, this boutique transit hotel offers
new aircraft parking bays and integration of Airport 4.0 technology to 46 luxury beds and a range of amenities, including a lounge, spa, gym,
preferences and solidifying its
CapsuleTransit position as a key regional hub for
improve operational efficiency.
MAX
plant-based airport lounge, steam baths and a “runway suite” with airport 46
views. It also provides meeting and event spaces as part of its Business
Club facilities.
international tourism and business.
Sources: Various / Knight Frank Research

38 39
Occupancy and Room Rates Market Outlook 80 medical facilities are listed on the JOHOR additional facilities, including a private
MHTC website, with approximately marina and a mega yacht marina to
The Malaysian hotel sector continues its recovery trajectory, mirroring the In 3Q2024, Malaysia’s economy 65% located in the Klang Valley. Supply & Demand accommodate a wide range of vessels.
resurgence of the broader travel and tourism industry. City-centre hotels, demonstrated strong resilience, Strategic policies, including relaxed The newly established marina offers
particularly those in the Klang Valley, have seen improved occupancy rates driven achieving a 5.3% growth rate visa restrictions and investments in During the first ten months of 2024, premium amenities such as a fuel dock,
by rising international tourist arrivals. While current rates remain slightly below driven by robust domestic demand, healthcare infrastructure, further Johor recorded 17.7 million tourist laundry and shower facilities, buggy
pre-pandemic levels, the upward trend is encouraging. recovering exports and a thriving strengthen Malaysia’s position as a arrivals, reflecting a remarkable transport, a customs, immigration and
tourism sector. This momentum is top destination for medical tourists. 31.8% increase compared to the same quarantine (CIQ) complex and a marine
expected to continue, supported period in 2023 (13.5 million arrivals). department office. These features
Average Occupancy Rate of All Star-Rated Hotels in Klang Valley,
by The Ministry of Tourism, Arts The aviation sector also plays a This underscores a strong recovery position Pinetree Marina & Resort
2018 to 3Q2024
and Culture (MOTAC) which aims pivotal role in boosting Malaysia’s in the tourism sector, driven by the as a premier destination for yachting
80%
to attract 27.3 million international tourism growth. Malaysia Airports stabilisation of the global economy enthusiasts, leisure travellers and
tourists and generate RM102.7 Holdings Berhad (MAHB)recorded post-pandemic. A key driver of this business visitors.
billion in revenue for 2024. 101.2 million passengers in the first growth is Johor’s strategic proximity
Average Occupancy Rates (%)

60%
By November 2024, Malaysia nine months of 2024, recovering to Singapore, which remained its Meanwhile, Johor Bahru’s hospitality
had achieved over 80% of this to 96.3% of 2019 levels. New leading source of international sector is undergoing significant
40% target, welcoming 22.5 million international air links and expanded tourists, contributing approximately changes with the closure and
international visitors. The global connectivity have significantly 79.4% of total arrivals (14.1 million redevelopment of two prominent
tourism recovery has further contributed to facilitating tourist visitors). This reinforces Johor’s hotels. Hotel Mutiara Johor Bahru,
20% strengthened Malaysia’s position, arrivals. The introduction of direct position as a preferred destination a well-known 4-star hotel with 80
enabling the country to attract even flights, such as from Kenya to KLIA2, for Singaporean travellers. Indonesia rooms, is currently being demolished.
more tourists in the coming months. Singapore to Malacca and Ho Chi ranked second with a 6.3% share, Similarly, Hotel Sentral Johor Bahru,
0% Minh City to Kota Kinabalu, in total, followed by China at 4.5%. Notably, a 3-star hotel along Jalan Tenteram in
2018 2019 2020 2021 2022 2023 Jan - Sept 2024
Budget 2025 highlights significant 20 new routes, including those from tourist arrivals from China surged by the CBD, ceased operations and began
Kuala Lumpur Selangor Putrajaya
initiatives, such as upgrading AirAsia, will be launched in the over 200%, rising from 262,126 visitors demolition in 2H2024. With 138 rooms,
Sources: ADATA / Knight Frank Research
entry port facilities and systems coming months, further strengthens between January and October 2023 it was popular among budget-conscious
to accommodate large-scale Malaysia’s connectivity. By 2025, to 802,131 during the same period in travellers due to its affordable pricing
Since the reopening of international borders in April 2022, both the average MICE (Meetings, Incentives, Malaysia Airlines will resume its 2024 (Source: Tourism Johor). and strategic location near the Johor-
occupancy rate (AOR) and average daily rate (ADR) for 3- to 5-star hotels in the Conferences and Exhibitions) Kuala Lumpur-Paris route after a Singapore Causeway. The site of Hotel
Klang Valley have steadily improved. By 2023, occupancy rates approached pre- events, including Malaysia’s nine-year hiatus and expand its As of 3Q2024, Johor’s hospitality Sentral will be redeveloped into a
pandemic levels, while ADR surpassed pre-pandemic figures as early as 2022 and 2025 ASEAN Chairmanship. codeshare operations to the U.S., industry comprised 488 hotels, offering serviced apartment project named Gen
continued its upward trajectory throughout 2023. Additionally, strategic promotions enhancing Malaysia’s accessibility a total of 31,971 rooms, an increase Rise by Majestic Gen.
for Visit Malaysia Year 2026 at to key markets. of 0.8% in the number of hotels and
In 3Q2024, the sector recorded modest yet steady gains in both AOR and ADR. global events like the World Expo, 2.5% in room supply compared to These closures and redevelopment
Performance metrics for selected 4- and 5-star hotels in Kuala Lumpur city centre aim to restore tourist arrivals to Malaysia’s hospitality sector in 3Q2023 (484 hotels with 31,184 rooms). projects reflect evolving market
were particularly strong, with ARR reaching RM721, a 16.1% year-on-year (y-o-y) pre-pandemic levels and reinforce Klang Valley has shown signs of Approximately 53.5% of the hotel demands and priorities in Johor Bahru,
increase and occupancy rising by 2.3% y-o-y to 63.1% Malaysia’s status as a premier global recovery, with AOR and ADR steadily rooms are rated 3-star or above, with signaling a shift in the city’s hospitality
destination. improving. The introduction of visa- 4-star and 5-star hotels accounting for and accommodation landscape.
These positive developments can be attributed to Malaysia’s appeal as a top free policies for Chinese and Indian 23.8% (23 hotels, 7,607 rooms) and 7.8%
global tourism destination, ranked 6th by the Mastercard Economics Institute in In efforts to diversify tourism tourists has been a key driver of (9 hotels, 2,506 rooms), respectively. Market Outlook
May 2024. Contributing factors include the introduction of visa-free policies and offerings, the Government revised these improvements. Notably, China Additionally, the latest statistics reveal
expanded airline connectivity, such as the addition of Shanghai Airlines, AirAsia the Malaysia My Second Home extended its visa exemption for that nine hotels are under construction Johor Bahru remains a key tourist
Cambodia and 9Air, which have collectively increased passenger traffic and (MM2H) program, targeting high- Malaysian citizens until 2025, while and eight have received planning destination, with Singaporean
boosted the sector’s growth. net-worth foreign nationals for Malaysia will continue granting approval, collectively set to deliver visitors continuing to dominate
long-term residency. By offering visa exemptions to Chinese visitors 5,478 additional rooms. international arrivals due to the
AOR & ADR of Selected 3-star to 5-star Hotels in Klang Valley, favourable conditions for retirees, until 2026. city’s strategic location and seamless
2018 to 3Q2024 expatriates, medical tourists and The average occupancy rate (AOR) for connectivity to Singapore. The strong
foreign investors, this initiative Looking ahead, the Klang Valley is 3- to 5-star hotels in Johor recorded a post-pandemic recovery, as evidenced
500 70%
Average Daily Rate (RM per room per night)

is expected to generate positive set to see a wave of new luxury and significant improvement, increasing by rising AOR and ADR, coupled with
spillovers in real estate, healthcare upscale international hotel openings by 8.5% from 61.4% in 3Q2023 to redevelopment and enhancement
Average Occupancy Rate (%)

375 53% and education, enhancing in 2025. Prominent brands such as 66.6% in 3Q2024. This upward trend projects tailored to meet evolving
Malaysia’s appeal as a second-home Kempinski Hotels, Waldorf Astoria indicates a strong recovery in the traveller expectations, paints a
destination. and Park Hyatt are expected to enter hospitality sector, with occupancy positive outlook for Johor Bahru’s
250 35% the market, driving strong growth levels surpassing pre-pandemic figures. tourism industry. Sustained growth
Additionally, the Malaysia in ADR. With rising tourist arrivals Concurrently, the average daily rate and increasing regional popularity
125 18%
Healthcare Travel Council (MHTC) and active tourism promotion, (ADR) for selected 3- to 5-star hotels are expected in the years to come.
continues to expand the healthcare the industry is well-positioned in Johor Bahru saw robust growth,
tourism industry, targeting for sustained recovery, reflecting rising by 19.5% year-on-year (y-o-y) to
0 0% markets such as China, India investors’ confidence in the sector. RM267 per night. This reflects growing
2018 2019 2020 2021 2022 2023 1Q-3Q 1Q-3Q
2023 2024 and Indonesia. With a globally This continued expansion, combined demand for tourist accommodations as
Average Occupancy Rate (AOR) 3-Star Average Daily Rate (ADR) 3-Star
recognised healthcare system, with Malaysia’s robust tourism the industry rebounds.
Average Occupancy Rate (AOR) 4-Star Average Daily Rate (ADR) 4-Star
Average Occupancy Rate (AOR) 5-Star Average Daily Rate (ADR) 5-Star extensive medical expertise and initiatives, improved connectivity,
Muslim-friendly facilities, Malaysia and strategic government efforts, During the review period, Tiong Nam
Sources: ADATA / Knight Frank Research has positioned itself as a hub for underscores the resilience and Hospitality Group ventured into the
medical tourism. In 2023, medical growth potential of the country’s marina industry with the addition of
tourism revenue reached RM2.25 tourism and hospitality sectors. a 76-berth public marina at Pinetree
billion, nearly four times the 2021 Marina & Resort, Puteri Harbour.
figure. As of November 2024, over Plans are underway to introduce

40 41
PENANG Citadines Connect Cecil Georgetown: The Ascott Malaysia portfolio expanded SABAH to introduce Wyndham Semporna international brands, with planned
with the opening of its 13th property in the State, Citadines Connect Cecil Resort, formerly known as Borneo hotel developments reflecting
Supply & Demand Georgetown, opened on 21 November 2024. This 3-star hotel provides a total of Supply & Demand Semporna Resort. Scheduled to open continued confidence in Sabah’s
75 rooms and an array of amenities, including a fitness centre, indoor swimming in 2026, this large-scale overwater tourism potential and its appeal as a
As of 3Q2024, Penang State recorded pool, jacuzzi and a stylish lobby lounge, catering to business and leisure travellers. Sabah is expected to surpass its 2024 villa resort will feature 188 luxurious prominent global travel destination.
a total of 248 hotels with 25,071 target of 3.0 million tourist arrivals, villas equipped with modern
rooms, reflecting a 2.9% increase in The table below highlights the upcoming hotel projects in Penang State for the with 2.4 million visitors recorded amenities, infinity pools, multiple
the number of hotels and a 7.4% rise year 2025. by September, representing 28.3% dining venues, a fitness centre and
in total room supply compared to increase compared to the same period sightseeing platforms. As the first
3Q2023, which had 241 hotels and in 2023. Domestic tourists accounted internationally branded resort of
23,337 rooms. Approximately 68% Development Name Locality Star Rating No. of Rooms for 59% (1.4 million arrivals), while its kind in Semporna, it aims to
of the hotel rooms are rated 3-star or international visitors made up 41% attract global travellers by leveraging
above, with 4-star hotels accounting The Millen George Town 5-Star 146 (991,629 arrivals). Wyndham’s extensive network and
for 33% (32 hotels, 8,364 rooms) loyalty programs.
Capri by Frasers Hotel George Town 5-Star 255
and 5-star hotels comprising 22% Tourism receipts from January to
(21 hotels, 5,568 rooms). JdV by Hyatt Gelugor 5-Star 156 September 2024 totaled RM5.62 Market Outlook
billion, reflecting a strong year-on-
In terms of future supply, the Hotel Equatorial Penang Bukit Jambul 5-Star 662 year (y-o-y) growth of 36.5%. China Sabah’s tourism market is expected
development pipeline includes 11 remains Sabah’s largest international to sustain its strong recovery, driven
InterContinental Penang
hotels with 2,060 rooms currently Resort
Teluk Bahang 5-Star 355 tourist market, contributing 262,070 by a strategic focus on China as the
under construction and another 11 arrivals and generating approximately primary international source market.
hotels with 1,480 rooms that have Fifth Avenue Hotel George Town 4-Star 241 RM1 billion in tourism receipts Growth will be further supported
obtained planning approval. These between January and July, according by the comprehensive upgrades
Galaxy Minyoun Penang
projects are expected to collectively The Light City Hotel
Gelugor 4-Star 303 to the Sabah Tourism Board (STB). at KKIA and the introduction of
add 3,540 rooms to the market. new flight routes, enhancing the
M Social Resort Penang Tanjung Bungah 4-Star 318 To further enhance capacity, state’s connectivity. The hospitality
Notable hotel openings in Penang in a RM442.3 million has been sector is also set to benefit from
Harris Sunshine Penang Ayer Itam 3-Star 289
2024 include: allocated to upgrade Kota Kinabalu growing interest by renowned
Citadines Tanjung Tokong International Airport (KKIA).
Tanjung Tokong 3-Star 132
Iconic Marjorie Hotel, Bayan Penang Funded by Malaysia Airports
Lepas: Officially opened on 7
December 2024, the Iconic Marjorie
Source: Knight Frank Research
Holdings Bhd (MAHB) through an
investment-recovery model, the
EAST COAST
Hotel operates under Marriott four-year project will expand the New Hotel Completions in Genting Highlands, Pahang,
International’s Tribute Portfolio The average occupancy rate (AOR) for 3- to 5-star hotels in Penang rose terminal’s capacity to accommodate under the Trademark Collection by
brand. Inspired by Peranakan significantly by 8.3%, from 66.4% in 3Q2023 to 71.9% in 3Q2024. Similarly, the 12 million passengers annually (up The East Coast of Malaysia witnessed Wyndham. The hotel is scheduled
heritage, this 5-star hotel offers 298 average daily rate (ADR) increased modestly by 2.3%, moving from RM342 per from 9 million), construct a multi- several notable hotel openings by for a soft opening in December 2024.
rooms along with modern amenities night in 3Q2023 to RM350 per night in 3Q2024, reflecting steady recovery and storey parking facility and add seven international hospitality brands in Additionally, GIM will include 178,000
such as lounges, a restaurant, bar, growing demand in the hospitality market. aircraft parking bays. Surrounding 2024, signalling the region’s growing sq ft of retail space, featuring a variety
fitness centre, outdoor pool and infrastructure will also be improved appeal as a tourism destination: of shopping and dining options.
meeting spaces. It joins Lone Pine Market Outlook with green technology and Airport 4.0
Hotel in Batu Ferringhi as the second innovations to optimise efficiency. Fairfield by Marriott Kuala Besut: In Port Infrastructure Developments
Tribute Portfolio property in Penang. The hospitality market in Penang is set for continued growth in 2025, supported 2H2024, Fairfield by Marriott opened
by improved accessibility and rising tourist arrivals. The addition of upcoming The aviation sector in Sabah its third hotel in Malaysia, located in Malaysia is focusing on enhancing its
Crowne Plaza Penang Straits hotel developments, along with the resumption and expansion of direct local and continues to grow, with new flight Kuala Besut, Terengganu. The hotel port infrastructure to attract cruise
City, Butterworth: The Crowne international flights from key cities such as Guangzhou, Xiamen, Hong Kong, routes launched by AirAsia and offers 98 rooms, including standard, tourism and expand its hospitality
Plaza Penang Straits City, part of Dubai, Singapore, Bangkok, Phuket, Medan, Jakarta, Surabaya, Banda Aceh, Jeju Air during the review period. deluxe and premium options, as well as sector. Strategically located on the
IHG Hotels & Resorts, commenced Taipei, Ho Chi Minh City, Shanghai and Shenzhen are expected to enhance the Destinations include Subang, Manado, a Solo Traveller’s Pod designed for solo East Coast, Kuantan Port holds
operations on 1 August 2024, State’s connectivity and strengthen its appeal to international travellers. Kaohsiung, Ho Chi Minh City, Ningbo, travellers. It caters to both business and significant potential to become a key
becoming the first Crowne Plaza Kunming, Shantou and Busan, leisure travellers visiting the East Coast. cruise destination. With the East Coast
brand on mainland Penang. Penang is also well-positioned to maintain its leadership as Malaysia’s top enhancing connectivity and boosting currently lacking dedicated cruise
This 23-storey hotel features destination for medical tourism. In 1H2024, Penang contributed approximately tourist inflow. Perhentian Marriott Resort & Spa: terminals, Kuantan Port is well-
343 rooms and amenities such as 45% of the nation’s medical tourism revenue, attracting significant international In April 2024, Marriott Hotels has positioned for future development.
a rooftop swimming pool with patients, primarily from Indonesia and China. The State’s success in this sector Sabah’s hospitality sector is opened the Perhentian Marriott
panoramic views, a gym, restaurants is supported by its reputation for cost-effective, high-quality healthcare services, experiencing notable developments. Resort & Spa on Perhentian Kecil By becoming a homeport, Malaysia
and lounges. advanced medical technology, multilingual medical personnel and extended visa Borneo Beach and Mangrove Resort Island, Terengganu. Located within could capture significant economic
options, making it a preferred destination for medical tourists. Sdn Bhd has partnered with Hilton the stunning Perhentian Island benefits by encouraging cruise
lyf Georgetown Penang, George Group USA to develop two resorts in Marine Park, this resort marks the passengers to utilise local airports,
Town: Opened on 11 November 2024, Tuaran, involving a total investment flagship brand’s first property in stay in nearby hotels pre- and
the lyf Georgetown Penang by Ascott of RM500 million. This project Terengganu. The resort offers 200 post-cruise and contribute to local
Limited provides studio to three- includes a 5-star Hilton Resort and deluxe rooms and 17 villas, each spending. This strategic initiative
bedroom accommodations ranging a 4-star Hilton Garden Inn Resort, providing breathtaking sea views and aims to strengthen Malaysia’s cruise
from 151 sq ft to 603 sq ft. Amenities revitalising the site of the former a peaceful atmosphere, combining tourism sector while enhancing
include co-working spaces, event Mimpian Jadi resort and enhancing modern elegance and comfort. the East Coast’s attractiveness as a
venues, restaurants, a gym, the state’s upscale tourism offerings. tourism and investment hub.the East
a swimming pool and laundry 1001 Nights Hotel: In July 2024, Coast’s attractiveness as a tourism and
facilities, aimed at fostering Wyndham Hotels & Resorts, the NCT Group launched the 1001 Nights investment hub.
community engagement. world’s largest hotel franchisor, has Hotel at Grand Ion Majestic (GIM)
partnered with Goldstone Holdings

42 43
 MARKET KLANG VALLEY

INDICATIONS
Residential Property Market Performance

RESIDENTIAL
During the first nine months of 2024, the residential sub-
sector in the Federal Territory of Kuala Lumpur (WPKL)
saw improved market activity, recording 10,291 transacted
Malaysia’s residential sub-sector remained dominant, units worth RM8.82 billion, compared to 9,938 transactions

MARKET
accounting for 61.8% of total property transactions valued at RM8.29 billion in 9M2023. This represents a
nationwide. In the first nine months of 2024, 192,484 3.6% increase in sales volume and a 6.4% rise in sales value,
transactions were recorded, collectively valued at mirroring the national trend.
RM78.17 billion, an increase from 183,525 transactions
worth RM73.14 billion in 9M2023. This represents a Stratified high rise residential properties, including
year-on-year (y-o-y) growth of 4.9% in sales volume and apartments, condominiums and serviced apartments,
6.9% in sales value. drove the growth, with 8,356 units valued at RM7.60 billion
transacted, marking annual increases of 12.2% in volume
House price growth is slowing, as indicated by the and 25.2% in value (9M2023: 7,446 transactions worth
Malaysian House Price Index (MHPI), which rose by RM6.06 billion). The high rise unit price index for Kuala
only 2.7% y-o-y to 223.1 points in 9M2024 (9M2023: Lumpur rose by 1.3% y-o-y to 229.1 points (9M2023: 226.1
217.3 points). On a quarterly basis, the index declined by points), although it declined by 2.1% on a quarterly basis
2.4% (3Q2024: 220.2 points vs. 2Q2024: 225.7 points), (3Q2024: 227.5 points vs. 2Q2024: 232.4 points).
despite sustained demand for housing.
New residential launches across all types totalled 50,716
On the supply side, the total number of completed units in 9M2024, representing a 4.6% annual decline
residential units offered nationwide stood at 236,899 (3Q2023: 53,186 units), as developers remained cautious
units as of 3Q2024, marking a 4.8% decline y-o-y due to market challenges and high levels of unsold stock.
(3Q2023: 248,952 units). Property overhang showed Property overhang improved, with the number of unsold
notable improvement during the review period with completed units declining by 4.0% to 7,588 units in 3Q2024
the number of unsold completed properties declined by (3Q2023: 7,903 units).
11.2% to 42,126 units in 3Q2024 (3Q2023: 47,463 units).

The residential market sees

renewed activity, particularly in
the high rise segment, support
ed by targeted government
initiatives and stable economic
conditions. Affordable housing
programs and innovative
developments cater to evolving
buyer preferences and market
needs.

45
Supply of High-End High Rise Residential CloutHaus Residences KLCC by office suites. The project boasts over Located in Ampang Hilir’s prestigious Embassy Row, Skyline Embassy (formerly
TA Global Berhad, located on 70,000 sq ft of amenities, including Agile Embassy Garden) by TSLAW land Sdn Bhd, offers 1,296 units ranging from
As of 2024(p), the supply of high-end condominiums and residences in selected Jalan P. Ramlee near the iconic the city’s highest gym on Level 63A, 521 sq ft apartments to 976 sq ft dual-key units. With rooftop facilities such as
areas of Kuala Lumpur totalled 82,679 units. During 2H2024, four projects were Petronas Twin Towers and Suria a 118-metre rooftop infinity pool a Sky Infinity Pool, Sky Jacuzzi, and Sky Terrace, the development provides
completed, contributing an additional 1,167 units to the cumulative stock. An KLCC, is a luxurious freehold mixed- and a Sky Deck offering stunning breathtaking views of the Kuala Lumpur skyline. Promising strong rental yields
additional 3,625 units from several active developments are slated for completion use development comprising two skyline views. Residents benefit and potential capital appreciation, it offers an attractive investment opportunity
by 1H2025. towers. Tower 1 features 242 private from an elevated bridge connecting for both investors and homeowners.
residences and 548 hotel rooms directly to Pavilion Bukit Bintang,
Projected Cumulative Supply of High-End Condominiums / Serviced under the Paradox KLCC brand, as well as seamless access to major Southpoint Residences, by Tan & Tan Developments, is the final residential
Apartments, 2016 to 2H2024(p) Malaysia’s first Paradox Hotel, transportation networks, including component in Mid Valley City, offering unparalleled connectivity with easy
90,000
while Tower 2 offers 615 serviced the Bukit Bintang MRT station, access to major roads, highways, bus networks and train stations. Integrated with
apartments. The development Monorail and nearby highways, The Gardens Mall and Mid Valley Megamall, it provides direct access to shopping,
includes premium amenities such enhancing connectivity and dining and entertainment. Part of the 59-storey Menara Southpoint mixed-
as an infinity pool, rooftop lounge, convenience. use development, it includes 27 floors of office space and 22 levels of serviced
fitness centre and co-working apartments. Designed with a Built-To-Sell concept, Southpoint Residences offers
67,500
Cumulative Supply (no. of units)

spaces. Committed to sustainability, Lofthill Residence by Armani 172 units of spacious serviced apartments with built-up areas ranging from
CloutHaus aims to achieve Group redefines urban living with 1,119 sq ft to 6,878 sq ft, catering to professionals and families. The development
GreenRE Provisional Certification, its modern design, exceptional features world-class amenities, including a fitness centre, swimming pool and
incorporating eco-friendly features convenience and unobstructed views landscaped gardens.
45,000
like siphonic rainwater systems, of the Kuala Lumpur city skyline.
pneumatic waste collection and an Strategically located in Kampung Demand for Luxury Homes in Kuala Lumpur
automated car park system. Baru near key healthcare institutions
like Hospital Kuala Lumpur and Kuala Lumpur’s prime residential segment has rebounded post-pandemic, driven
22,500 Hanaz Suites KLCC by Exsim Institut Jantung Negara as well as the by improving economic conditions, positive market sentiment and government
Development Sdn Bhd, a 45-storey tranquil Taman Tasik Titiwangsa, initiatives such as the Malaysia Premium Visa Programme (PVIP) and Malaysia
development located close to it offers easy access to the Raja My Second Home (MM2H) programme. Under the revised MM2H guidelines,
Kuala Lumpur’s key business and Uda MRT station. This 51-storey applicants are required to purchase a residential property priced between
entertainment districts, offers 270 development features 653 serviced RM600,000 and RM2 million, depending on the visa category (Silver, Gold, and
0
2016 2017 2018 2019 2020 2021 2022 2023 2H2024(p) serviced apartments sized between apartments with sizes ranging from Platinum). While this requirement benefits the high-end residential segment, it
KL City Damansara Heights / Bukit Tunku / Bukit Kiara 327 sq ft and 657 sq ft, alongside 610 sq ft to 1,917 sq ft. Designed for may discourage prospective applicants who prefer renting homes.
Ampang Hilir / U-Thant / Jalan Ampang Dutamas / Mont' Kiara / Sri Hartamas / North Kiara office suites. Amenities include a first-time homebuyers and investors,
Bangsar / Bangsar South / Kerinchi / KL Sentral /
Brickfield / Mid Valley City / KL Eco City / part of Seputeh
Sensu-inspired pool, sakura-themed Lofthill Residence includes premium During the first nine months of 2024, the sales volume and value of stratified high
Source: Knight Frank Research pool, meeting spaces and a rooftop amenities such as co-working spaces, rise residential properties, including apartments, condominiums and serviced
Note: (p) = Preliminary
party lounge. Managed by Mana fitness centres and landscaped apartments, rose by 12.2% and 25.2%, respectively.
Mana Hospitality, the development gardens, setting a new benchmark for
Completions of High-End Condominiums / Serviced Apartments, 2H2024 provides attractive rental return modern urban living. In the high-end residential segment, specifically high rise properties priced at
options, including a 4% annual return RM1 million and above within Kuala Lumpur City Centre, a total of 941 units
Project Location Area Total Units with an 80/20 profit-sharing model worth RM1.86 billion were transacted in 1H2024. This represents an increase from
or a guaranteed 6% annual return, 591 units valued at RM1.14 billion transacted in 2H2023.
Core Residence @ TRX Tun Razak Exchange KL City 580 appealing to both investors and city
dwellers. The overall average transacted price for high-end condominiums and serviced
The Atrium Jalan Ampang Hilir U-Thant 241
apartments in the reviewed localities remained relatively stable, with a modest
Alfa Bangsar Jalan Maarof Bangsar 178 Pavilion Square by Pavilion Group, 0.4% increase in 2H2024 compared to the preceding half-year period.
strategically located at Jalan Raja
KaMi Mont’ Kiara Jalan Duta Kiara Mont’ Kiara 168
Chulan, redefines luxury living in Average Transacted Prices of Selected Existing High-End Condominiums
Source: Knight Frank Research Kuala Lumpur with easy access to / Serviced Apartments in Kuala Lumpur, 1H2024 and 2H2024 (p)
Bukit Bintang. This 67-storey mixed-
There were several notable projects launches and previews during the review period, use development features 960 studios Locality 1H2024 2H2024 (p) Price Trend
offering approximately 4,208 units in Kuala Lumpur. and 3-bedroom suites alongside
KL City 1,120 – 1,290 1,160 – 1,290

Notable Launches / Previews, 2H2024

Ampang Hilir / U-Thant 740 - 750 740 – 750
Unit Sizing Average Gross
Total
Name of Development Type (1) Developer Area (Min - Max) Selling Price
Units Bangsar 880 - 990 910 - 970
(sq ft) (RM per sq ft)

CloutHaus Damansara Heights 840 - 890 850 - 900

SA TA Global KLCC 857 549 – 1,216 2,700 – 3,250
Residences KLCC

Hanaz Suites KLCC SS Exsim Development Sdn Bhd KLCC 270 327 - 657 1,750– 2,350 Kenny Hills 630 - 690 630 - 690

Pavilion Square SA Pavilion Group Bukit Bintang 960 504 – 1,272 2,300 – 2,700
Mont' Kiara 680 - 830 680 - 800

Lofthill Residence SA Armani Group Kg. Baru 653 610 – 1,917 1,300 – 1,400
Overall 820 - 910 830 - 890
Skyline Embassy SA TS Law Land Ampang Hilir 1,296 521 - 976 1,500 – 1,800
Sources: Jabatan Penilaian dan Perkhidmatan Harta (JPPH) / Knight Frank Research
Southpoint Residence SA Tan & Tan Developments Mid Valley City 172 1,119 - 6,878 1,100 – 1,550
Notes:
(1) (p) = Preliminary – Analysis based on preliminary data
Source: Knight Frank Research
(2) The price analysis is calculated by weighted average approach based on recorded transactions of selected
Note: (1) SS = Serviced Suites; SA = Serviced Apartment Pavilion Square schemes.
Source: pavilionsquare-kl.com

46 47
Meanwhile, take-up rates for selected newly launched and ongoing projects have Looking ahead, the prime residential JOHOR Tropicana Corp Bhd has commenced
been promising, ranging between 30% and 50%, with developments like Lofthill market in Kuala Lumpur is expected construction of the RM34.0 billion
Residence and Skyline Embassy showing strong performance. Additionally, to remain stable, with gradual Residential Property Market Performance Lido Waterfront Boulevard project,
several soft-launched schemes have recorded encouraging booking levels, growth reflecting the broader a 163-acre integrated development,
reflecting healthy market interest. resilience of the Asia-Pacific In the first nine months of 2024, Johor’s residential sub-sector showed improved starting with the Skypark Kepler
real estate sector. The city offers market activity with 31,268 units transacted, totalling RM14.84 billion in value. luxury serviced apartments. The
Rentals investment opportunities for both This represents a 4.9% increase in transaction volume and a significant 13.3% rise latter, a joint venture with Banyan
locals and foreigners, with property in transaction value compared to 9M2023 (29,794 units worth RM13.10 billion). Group, will deliver 856 units across
The residential rental market for high-end high rise properties in Kuala Lumpur prices among the most affordable two 54-storey towers.
remains tenant-driven, with supply consistently outpacing demand. Tenants in Asia. Progress in road and rail The high rise residential market in Johor Bahru experienced robust demand, with
hold a strong negotiating position for both new leases and renewals. Rental infrastructure is further promoting transaction volumes and values increasing across the condominium / apartment
trends in areas like Damansara Heights and Mont’ Kiara declined during the suburban townships and transit- and serviced apartment categories. Transactions of condominiums / apartments
review period, influenced by factors such as evolving tenant preferences, lifestyle oriented developments (TOD) along rose by 13.6% in volume and 23.2% in value (9M2024: 2,299 units valued at
changes, increased choices in the rental market and heightened competition from key transit lines, catering to shifting RM993.48 million / 9M2023: 2,023 units worth RM806.72 million). Meanwhile,
alternative accommodations. buyer and investor preferences. the serviced apartment category recorded exceptional growth with transacted
volume and corresponding transacted value surging by 80.3% and 100.2%
Average Asking Rentals of Selected Existing High-End Condominiums / However, challenges remain due respectively (9M2024: 3,531 units worth RM2,227.33 million / 9M2023: 1,958 units
Serviced Apartments, 1H2024 and 2H2024 (p) to global inflationary pressures, worth RM1,112.33 million).
geopolitical tensions and economic
instability, which may temper market As of 3Q2024, the cumulative supply of high rise residential properties in Johor
Locality 1H2024 2H2024 (p) Price Trend
sentiment and broader recovery Bahru totalled 167,789 units, reflecting an annual increase of 8.0% from 155,419
efforts. Despite these uncertainties, units in 3Q2023.
KL City 2.20 - 6.00 2.20 - 6.00 Malaysia’s strategic location, cultural
richness and supportive government Supply and Demand for High Rise Residential
Ampang Hilir / U-Thant 2.40 - 3.10 2.20 - 3.30 policies continue to enhance its real
estate appeal, positioning the market Several notable high rise residential projects were launched or previewed,
Bangsar 2.00 - 4.30 2.00 - 4.30 for resilience and long-term growth. primarily in the fringe of Johor Bahru City, evident of growing interest in the area.

Damansara Heights 2.30 - 4.90 2.00 - 5.10 The Asteriaz @ Kebuh Teh
Notable Launches / Previews, 2H2024 Source: exsim-asteriaz.com

Mont' Kiara 2.10 - 4.50 2.00 - 4.40 Unit Sizing Average Gross
Name of Total
Type (1) Developer Area (Min - Max) Selling Price
Development Units
(sq ft) (RM per sq ft)
Source: Knight Frank Research
Johor
Notes: Gen Rise @
(1) (p) = Preliminary – Analysis based on preliminary data SA Majestic Gen Bahru City 732 497 – 1,930 1,108 – 1,328
JBCC
(2) The analysis is based on asking rentals due to limited concluded rental data. Centre

The Asteriaz Exsim

SA 848 560 - 915 710 - 804
@ Kebun Teh Development
Market Outlook
Parkland by Parkland
SA 1,078 562 - 1020 680 – 755
The River Group
Malaysia’s residential property market is set for stable growth in 2025, driven
by its recovery post-pandemic and supported by government initiatives to Axteria
A - SOHO SOHO 474 449 - 618 622 – 825
promote homeownership and address affordability challenges. Bank Negara Development
Malaysia (BNM) has maintained the Overnight Policy Rate (OPR) at 3.00% since Permas
SA MB World Johor 1,950 650 – 948 540 – 640
May 2023, creating a stable environment for borrowers and property investors. Heights
Bahru City
This steady rate has provided certainty for first-time homebuyers, stimulating Arden @
Fringe
demand for residential properties. One Bukit SA Astaka Padu 600 750 – 1,650 1,300 – 1,500
Senyum
Under Budget 2025, the government introduced the Housing Credit Guarantee Nadi
SA Southkey City 395 649 – 1,050 650 – 660
Scheme (SJKP), offering tax relief of up to RM5,000 for first-time homebuyers CloutHaus KLCC Residences Arden @ One Bukit Senyum
Source: clouthaus.com.my Source: Arden OBS
purchasing properties priced between RM500,000 and RM750,000, supporting Senibong
homeownership among the middle-income group. Meanwhile, the Residensi Waterway Meanwhile, the average asking prices
SA Cove 491 930 – 1,426 590 – 660
Peaks
Madani initiative, under the MADANI Economy framework, aims to build 8,000 Development for high rise units in Johor Bahru
affordable housing units in the Federal Territories by 2027. Priced between Verte Medini Iskandar City Centre showed an upward trend,
SA CJ Invesco 1,106 614 - 935 589 - 730
RM150,000 and RM200,000, these homes target the B40 income group, Residence Puteri while prices in Johor Bahru City
addressing housing affordability in Kuala Lumpur. Source: Knight Frank Research
Fringe and Iskandar Puteri & Medini
Note: (1) SA = Serviced Apartment
remained relatively stable with
The private sector is complementing these efforts with innovative campaigns. nominal increments compared to the
Maybank’s Green Home Financing initiative offers 95% + 5% financing for previous period. These developments
certified green properties, covering upfront costs such as insurance, legal fees During the review period, there were several notable announcements relating to highlight the increasing activity and
and stamp duty, while providing preferential interest rates for eco-friendly the high rise residential sector in Johor Bahru. resilience of Johor Bahru’s high rise
homes. Developers like Sunway Property have introduced packages like ‘Dream residential market.
Home Dream Phone,’ which include MOT subsidies, free kitchen cabinets and Paragon Globe announced a new serviced apartment project with a gross
legal fee waivers, alongside enhanced after-sales services such as Handyman development value (GDV) of RM1.5 billion, comprising 2,552 units across four
services under the Sunway Property+ (SP+) programme. Similarly, Sime Darby 36-storey towers in Johor Bahru.
Property’s ‘The Perfect 10’ campaign offers attractive deals, including early bird
privileges, cash rewards, free MOT, stamp duty and free 12-month maintenance Chin Hin Group Property Bhd, in collaboration with Atlan Holdings Bhd, plans to
fee, across multiple developments in prime locations. develop a high rise project featuring 1,260 units of serviced apartments across two
Skyline Embassy
blocks, with a GDV of RM478.4 million.
Source: skylinembassykl.com

48 49
 Average Asking Prices of Selected Existing Condominiums / Serviced while serviced apartments account The Ascott Limited, in partnership with Instant Icon Sdn Bhd, announced plans
Apartments, 1H2024 and 2H2024 (p) for the remaining 7.9%. These figures for Ascott Residences Batu Ferringhi, the first branded residence under the Ascott
highlight a shift in market dynamics name in the region. This landmark development will offer 99 exclusive residences
Average Asking Prices amid increasing supply and changing ranging between 2,000 sq ft and 4,000 sq ft, with a penthouse exceeding 8,000 sq
(RM per sq ft) demand patterns. ft. Slated for completion by January 2028, the project promises premium facilities
such as a swimming pool, gym and dedicated concierge services. Its official launch
Locality 1H2024 2H2024 (p) Price Trend Supply and Demand for High Rise is anticipated in 2H2025.
Residential
Johor Bahru City Centre 760 – 1,150 830 – 1,170
In terms of market trends, the average asking prices of selected high rise
During the review period, there were properties in Tanjung Tokong and Tanjung Bungah rose in 2H2024, driven by
several notable projects launches developments like Marinox Sky Villas, City Residences and Springtide Residences.
Johor Bahru City Fringe 480 - 650 490 - 650
and previews in Penang, offering However, average prices in George Town and Gelugor remained stable during the
circa 846 units in total, reflecting review period. These developments highlight the continued demand for high-
Iskandar Puteri & Medini 530 – 750 560 – 750
strong developer activity and market quality residential properties in Penang’s prime areas.
Sources: Jabatan Penilaian dan Perkhidmatan Harta (JPPH) / Knight Frank Research
potential.

Note: The range of asking prices depends on location, scheme, unit sizing, floor level and other factors Average Asking Prices of Selected Existing Condominiums / Serviced
On 13 July 2024, Chin Hin Group
Apartments, 1H2024 and 2H2024 (p)
Property Berhad introduced its first
The Crown Penang
Market Outlook Penang project, Crown Penang, in Source: Penang Property Talk
Average Asking Prices
collaboration with Stellar Platinum (RM per sq ft)
The outlook for the high rise residential sector in Johor Bahru remains one of Sdn Bhd, Thirupathi Capital Sdn
optimism with numerous project launches in the pipeline. Developments near Bhd and Ivory Meadows Sdn Bhd.
Locality 1H2024 2H2024 (p) Price Trend
the upcoming RTS Link station are particularly appealing due to enhanced Located at Jalan Seri Tanjung Pinang
connectivity, often commanding premium pricing. 1, this freehold serviced apartment
650-950 (2) 650-950 (2)
development features 588 units
George Town
While land scarcity in the city centre may limit future projects, increased activity is ranging between 614 sq ft and 1,851
1,050-1,350 (3) 1,100-1,350 (3)
expected in fringe areas. In Iskandar Puteri, improved market sentiment is driving new sq ft, priced from RM1,150 per sq
launches, further strengthening the region’s property market. ft. Residents will enjoy premium Tanjung Tokong /
amenities, including a sky lounge, 550-1,000 (4) 650-1,050 (4)
Tanjung Bungah
gymnasium, swimming pool, sky park
PENANG and zen garden. Gelugor 550-1,100 (5) 600-1,100 (5)

Sources: Jabatan Penilaian dan Perkhidmatan Harta (JPPH) / Knight Frank Research
Residential Property Market Performance Eastern & Oriental Berhad launched
The Lume, a luxury condominium Notes:
(1) (p) = Preliminary - Analysis based on preliminary data
Penang’s residential sub-sector experienced mixed performance in the first nine project within its 760-acre Andaman (2) Refers to units with built-up areas of 4,000 - 4,200 sq ft
months of 2024. Transaction volume saw a slight decline of 0.8%, with 13,210 Island masterplan development on 8 (3) Refers to units with built-up areas of 2,200 - 2,800 sq ft
(4) Refers to units with built-up areas of less than 2,000 sq ft
units sold, compared to 13,323 units in the same period of 2023. Despite this, the August 2024. Situated in the Shoreline (5) Refers to units with mixed built-up areas of less than 2,000 sq ft and the bigger built-up areas more than
4,000 sq ft
value of transactions increased by 4.0%, reaching RM6.14 billion in 9M2024, up District of the project’s first phase,
The Lume
from RM5.91 billion in 9M2023. The Lume offers 261 units across a Source: Penang Property Talk

50-storey tower, with built-up areas Market Outlook

The high rise residential market faced challenges, with transaction volume ranging between 1,722 sq ft and 2,874
dropping by 15.7%, from 3,130 units in 9M2023 to 2,638 units in 9M2024, while sq ft and priced from RM2.2 million. The high rise residential market in Penang is expected to maintain its upward
the corresponding transacted value declined by 9.5%, from RM1.19 billion to With a gross development value momentum, supported by the State’s robust economy, a stable Overnight Policy Rate
RM1.72 billion. (GDV) of RM689 million, the project (OPR) set by Bank Negara Malaysia (BNM), continued labour market improvements
features extensive facilities, including and a moderate increase in median wages. Additionally, key infrastructure
As of 3Q2024, Penang’s total cumulative supply of high rise residential properties landscaped pools, co-working spaces developments, including the commencement of construction for the Penang LRT
reached 122,271 units, an annual increase of 7.8% (3Q2023: 113,394 units). and pet-friendly areas and has earned Mutiara Line in 4Q2024 and ongoing Penang International Airport (PIA) upgrade
Condominiums and apartments make up the majority of the supply at 92.1%, GreenRE Platinum certification for its works, are anticipated to further boost the overall property market, enhancing
sustainable design. connectivity and supporting demand in the high rise residential segment.

Notable Launches / Previews, 2H2024

Unit Sizing Average Gross

Total
Name of Development Type (1) Developer Area (Min - Max) Selling Price
Units
(sq ft) (RM per sq ft)

Chin Hin Group Property Seri Tanjung

The Crown Penang SA 588 614 – 1,851 From 1,150
Berhad Pinang

Seri Tanjung
The Lume C Eastern & Oriental Berhad 261 1,722 – 2,874 From 1,100
Pinang

Mutiara Biopolis
Bayan Suites SA Bayan Mutiara 326 592 – 1,184 From 800
Developments Sdn Bhd

Central Residences C Major Development Sdn Bhd Jelutong 298 1,177 – 1,421 From 600

Source: Knight Frank Research

Note: (1) C = Condominium; SA = Serviced Apartment

50 51
 SABAH In 1H2024, Greater Kota Kinabalu site at Jalan Bukit Temasu, Luyang. The redevelopment, led by its subsidiary
recorded 1,410 residential transactions Ambience Acres Sdn Bhd, is in the preliminary planning stages and will follow
Residential Property Market Performance valued at RM720.34 million, reflecting the demolition of the existing building.
a 14.9% increase in volume and a
As of 3Q2024, the existing supply of residential units in Greater Kota Kinabalu 25.7% rise in value year-on-year Additionally, two high rise developments, Forest Hill Residences by Peak Sunrise
(covering the districts of Kota Kinabalu, Penampang, Putatan, Tuaran, and Papar) (y-o-y). Condominiums / apartments Development Sdn Bhd and Residensi Seri Akasia by KTI Sdn Bhd, were recently
stood at 137,985 units, reflecting a marginal increase from 137,981 units in 2Q2024. continued to dominate the market, completed and have received their respective Occupation Certificates (OC).
accounting for 43.4% of transaction
Transaction Volume and Value by Residential Property Type, 1H2023 and volume, followed by terraced houses Rentals
1H2024 with a 35.6% share among selected
residential property categories. In 2H2024, the rental market experienced a slight decline in several localities,
Transaction Volume including KK City Centre & Fringe Areas, Bundusan/Kobusak, Damai/Luyang
(No. of Units)
Supply for Residential Properties and Kolombong/Inanam. However, Kepayan recorded a modest increase in its
Type of
average asking gross rental, while Likas maintained stable rental levels during
1H2023 1H2024 Y-o-Y Growth During the review period, new the review period.
Residential Property
launches of both landed and high rise
Terraced Houses 435 502 15.4% residential schemes were introduced,
Average Asking Rentals of Selected Existing Condominiums, 1H2024 and
as outlined in the following table.
Semi-Detached Houses 162 191 17.9% 2H2024 (p)

Detached Houses 64 105 64.1%

All newly launched landed schemes
offered double-storey terraced houses Locality 1H2024 2H2024 (p) Price Trend
Condominium / and are predominantly located
566 612 8.1%
Apartment in the outskirts of Greater Kota KK City Centre & Fringe
1.80 - 4.45 1.90 - 4.30
Kinabalu, except for developments Areas
TOTAL 1,227 1,410 14.9%
in Penampang. Most of these are
Bundusan / Kobusak 1.30 - 2.95 1.55 - 2.60
Transaction Volume
smaller-scale projects, with the
(RM Million) exception of Taman Lagun Ria.
Damai / Luyang 1.30 - 3.25 1.55 - 3.15
Type of In Penampang, two newly launched
1H2023 1H2024 Y-o-Y Growth
Residential Property Kepayan 1.45 - 2.60 1.50 - 2.65
apartment projects feature lift
Terraced Houses 181.78 237.27 30.5% facilities, enhancing vertical access.
Kolombong / Inanam 1.25 - 2.65 1.20 - 2.55
Semi-Detached Houses 121.45 141.61 16.6% In Papar, Parklane Residences (Tower
A) offers a variety of amenities, Likas 1.35 - 3.00 1.40 - 3.00
Detached Houses 69.43 117.83 69.7% including a swimming pool, jogging
Sources: Jabatan Penilaian dan Perkhidmatan Harta (JPPH) / Knight Frank Research
Condominium /
track and a playground, providing
200.25 223.63 11.7% convenience for its residents. Notes:
Apartment
(1) (p) = Preliminary – Analysis based on preliminary data
(2) The analysis is based on asking rentals due to limited concluded rental data.
TOTAL 572.91 720.34 25.7% Asian Pac Holdings Berhad (KL:
Sources: National Property Information Centre (NAPIC) / Knight Frank Research
ASIAPAC) plans to redevelop the
former Kendara Court Condominium Market Outlook

Looking ahead, the residential market in Greater Kota Kinabalu is expected

Selected Residential Launches / Previews, 2H2024 to see fewer new launches, as many developments progress through multiple
phases. High rise residential projects are anticipated to grow steadily in mature or
Property Typical Unit Size Approximate Land
Locality, District Scheme Name
Type (1) (sq ft) (2) Area (sq ft)
No. of Units strategically located neighbourhoods, while the momentum for landed residential
launches continues to build.
Kibabaig, Penampang Prima Sumundu (Phase 3) DST 1,427 - 1,574 2,000 – 5,529 37

Novoung, Papar Taman Seri Novoung (Phase 1A) DST 1,093 1,030 - 2,645 20

Jalan Kelanahan, Papar Taman Desa Kelanahan (Phase 2) DST 977 – 1,097 1,092 – 4,570 65

Mengkabong, Tuaran Taman Lagun Ria (Phase 1) DST 1,483 - 1,588 1,028 - 2,220 188

Laya-Laya, Tuaran Taman Bayu DST 1,190 - 1,320 1,083 - 2,250 78

Gunsing, Penampang Grand Height Apartment A 813 - 56

Jalan Dimpoukon,
Residensi Dimpoukon A 1,016 - 144
Penampang

Benoni, Papar Parklane Residences (Tower A) C 600 – 1,100 - 215

Source: Knight Frank Research

Notes:
(1) Property Type: C: Condominium; A: Apartment; DST: Double storey Terraced.
(2) Typical unit size excludes penthouses.

52 53
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