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- Landserve (Johor) Sdn Bhd executive director Wee Soon Chit said things have "gone crazy", referring to skyrocketing land transactions in Johor Bahru driven by the upcoming RTS Link to Singapore.
KUALA LUMPUR (May 19): Johor Bahru’s property market is heating up as land prices surge to record highs near the upcoming Johor-Singapore Rapid Transit System (RTS) Link, says a real estate expert.
Landserve (Johor) Sdn Bhd executive director Wee Soon Chit said things have "gone crazy", referring to skyrocketing land transactions in Johor Bahru driven by the upcoming RTS Link to Singapore.
“Next to RTS, we have some lands transacted as high as RM1,000 per square foot. I’m also aware of another piece that is going around RM2,000 per square foot. Johor’s old town areas like Jalan Trus and Jalan Wong Ah Fook have seen shophouse land transactions hitting RM2,000 per square foot and beyond.
“In April this year, a piece of land in Taman Suria was put up for auction with a reserve price of RM54 million. Someone took it at RM136.8 million, that's almost RM650 per square foot,” he said during “The State of the Property Market—Where Do We Go from Here?” session at the Smart Housing, Sustainable Property and Innovative Cities Forum here today.
He added that developers from the Klang Valley are flocking to Johor.
“WCT Holdings Bhd, Exsim Hospitality Bhd and many more are coming into Johor Bahru city now. We have a scenario where developers with land banks are rushing to launch, those without are rushing to buy. And good news is we have people rushing to buy too,” he stated.
Wee revealed that service apartment projects are being snapped up almost instantly.
“Even before it’s officially launched, registration opens and then within days, fully taken up,” he said.
ESG-compliant offices driving rental spikes in KL
JLL (Malaysia) Research and Consultancy for Malaysia head Yulia Nikulicheva explained that offices built with Environment, Social, Corporate Governance (ESG) principles and modern technologies in Kuala Lumpur are in very high demand because of the rapid uptake of such spaces and the resulting surge in rents.
“We saw 5% to 7% rental growth just in the last year for places like TRX, Damansara Heights, and EcoCity,” she added.
She said many older office districts in Kuala Lumpur, built 20 to 30 years ago, are getting outdated and losing their popularity.
“The government should provide some incentives to landlords to upgrade those offices,” she said.
While some private landlords have begun investing in ESG initiatives and modernization efforts, she said this isn’t happening at the pace tenants now expect.
“It would be good if some special incentives are introduced by the government to see through the whole process of upgrading the space and giving it a second life,” Nikulicheva added.
Malaysian property market enters phase of stability and maturity
CBRE WTW advisor Sr Foo Gee Jen said the property market in Malaysia has entered a new phase of stability and maturity, with consistent growth and a more informed buyer base.
“People are more knowledgeable about the asset. I think the flow of the growth now is sustainable,” he explained.
He said while some developers might not appreciate the current slow-and-steady pace, it reflects a more realistic and grounded market.
“Some property players may think all are very dull. You don’t have people queuing overnight… It’s not exciting anymore. But I think the reality of the crowd is a bit different today,” he added.
Foo also mentioned that current annual growth of about 5% to 6% signals a healthy and sustainable trajectory.
Strong demand in Penang hotspots; investor optimism in industrial, data sectors
Henry Butcher Malaysia Penang director Dr Sr Jason Teoh said property ownership trends in Penang show that homes are mainly bought either for occupation or investment.
“Every district has an inherent native population of its own as the northeast district (George Town) is the most densely populated, followed by Bukit Mertajam and then Batu Kawan,” said Teoh.
He stressed that one should also not underestimate Batu Kawan: “There’s hardly any unsold unit... there’s actually a lot of money in that part of Penang.”
“If you want to build something in Batu Kawan today, there is still demand for sure and also Bukit Mertajam and George Town as areas with strong demand,” Teoh explained.
Meanwhile, Knight Frank Malaysia group managing director Keith Ooi said sectors like data centres, industrial and logistics had taken centre stage this year, and the optimism is expected to carry through into next year.
“91% of the respondents are actually optimistic this year that their overall investment in the real estate market will perform well,” he said.
Despite this upbeat outlook, he explained that there are persistent challenges in the sector.
“The two primary challenges that majority of the investors and stakeholders have actually indicated were the rising construction costs, as well as the shifting of workspace trends,” he said, pointing to the ongoing impact of hybrid and remote work setups.
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