Knight Frank Malaysia, the global property consultancy, recently launched the Knight Frank Malaysia Real Estate Highlights 2H2015. The report looks into the market performance across the various property mix – residential, office and retail; and highlights the trends and outlook in the four key markets in Malaysia, including Kuala Lumpur, Klang Valley, Penang, Johor Bahru and Kota Kinabalu for the second half of 2015.
Kuala Lumpur high-end
• Sluggish market with potential buyers and investors adopting ‘wait and see’ approach.
• A Greater level of product innovation and marketing strategies to drive sales.
Kuala Lumpur and beyond Kuala Lumpur (Selangor) office markets
• Growing pressures on rental and occupancy levels amid a high supply pipeline of existing / new stock and a weaker leasing market.
• Despite a general slowdown, the investment market recorded several notable deals as savvy investors / funds seek quality assets for long-term returns.
Klang Valley retail market
• The majority of retailers exercise caution in their expansion plans amid poor sales performance and reduced profitability.
• Rental and occupancy levels at prime and established regional and neighbourhood shopping malls expected to remain resilient despite a high impending supply of circa 4.61 million sq ft by 1H2016.
• The overall volume of transactions declined 11.3% in 1H2015 compared to 2H2014 and the trend is expected to continue. No significant decrease in value as yet.
• The challenging outlook for all sub-sectors with further consolidation in the residential sub-sector.
• Iskandar Malaysia continues to register positive growth in investment, both local and foreign, with a cumulative investment of RM187.96 billion as at November 2015.
• Active industrial market with notable developments such as the Johor Biotech Park, Nusajaya Tech Park and Eco Business Park III.
• Infrastructure projects, namely the High-Speed Rail (HSR) and Rail Transit System (RTS) are expected to spur further economic growth in the longer term.
• Developers cautious on project launches, particularly in the high-rise residential segment due to slow absorption rate.
• Developers with sizeable land banks in fringe areas shifting focus to affordable and mid-range housing developments.
• The opening of Plaza Shell sets sets new benchmark for office sector in Kota Kinabalu.
DISCLAIMER: The data above represents the findings of Knight Frank and is not in any form and endorsement or recommendation by iProperty.com. Readers are encouraged to seek independent advice prior to making any investments.
This article was first published in the iProperty.com Malaysia March 2016 Magazine. Get your copy from selected news stands or view the magazine online for free at www.iproperty.com.my/magazine. Better yet, order a discounted subscription by putting in your details in the form below!