Latest news with #KnightFrankMalaysia
New Straits Times
29-05-2025
- Business
- New Straits Times
Malaysia emerges as strategic real estate hub amid global trade shifts
KUALA LUMPUR: As global trade tensions escalate and tariff policies grow more volatile, multinational corporations (MNCs) are recalibrating their real estate strategies—placing Malaysia in a strong position as a preferred investment destination, according to Knight Frank. In its latest regional report, From Whiplash to Resilience: Corporate Real Estate in the New World Order, Knight Frank highlights that sweeping tariffs—some as high as 124.1 per cent on Chinese imports during the Trump administration—have disrupted trade with over 57 countries. As a result, MNCs are moving away from speculative expansion and instead prioritising operational resilience, seeking locations that offer clarity, agility, and fit-for-purpose real estate solutions. Malaysia is emerging as a standout choice, with the report noting its appeal for cost-efficient, adaptable, and future-ready industrial property offerings. While regional peers such as Vietnam and India remain attractive for their scale, Knight Frank underscores Malaysia's strategic flexibility as a key differentiator in today's fragmented global trade landscape. "In today's fragmented trade landscape, Malaysia is proving attractive not because of bold moves but because of its ability to offer reliable, purpose-built industrial solutions that align with the operational demands of modern businesses," said Keith Ooi, group managing director, Knight Frank Malaysia. Knight Frank's research points to a significant uptick in Chinese investment into Malaysia's manufacturing sector, with inflows jumping from RM3.85 billion in 2017 to RM19.67 billion in 2018. This growth is being fuelled by manufacturers seeking supply chain diversification and a hedge against rising costs elsewhere. This trend, recently revitalised by high-level diplomatic engagements such as President Xi Jinping's state visit, reflects growing demand for build-to-suit facilities offering shorter leases, cost transparency, and customisable fit-outs, attributes increasingly sought in the post-pandemic era. Christine Li, head of research for Asia-Pacific at Knight Frank, added, "Malaysia's real estate market has quietly adapted." "We're seeing a shift from rigid 5-year lease terms to more agile, modular structures, especially in suburban industrial zones. These changes cater to SMEs and MNCs alike who are navigating unpredictable tariff regimes." The report stated that government support is also bolstering investor sentiment. Initiatives like the Johor–Singapore Special Economic Zone (JS-SEZ) aim to boost cross-border SME collaboration and enhance logistics, reinforcing Malaysia's positioning as a strategic—not secondary—player in regional economic realignment. While the global outlook remains cautious, Knight Frank sees Malaysia as offering "mixed but promising" potential, thanks to its strong fundamentals, policy clarity, and ability to adapt to shifting regional demand. "Malaysia may not be the loudest player in the room, but its flexibility, policy clarity, and infrastructure readiness are increasingly winning over global occupiers looking for long-term viability, not just short-term arbitrage," said Tim Armstrong, Global Head of Occupier Strategy and Solutions, Knight Frank. As global supply chains decentralise, Malaysia's ability to deliver future-fit, agile real estate solutions may well become its most valuable competitive advantage.
New Straits Times
13-05-2025
- Business
- New Straits Times
Kuala Lumpur prime property market steady, ranks 35th globally
KUALA LUMPUR: Kuala Lumpur ranked 35th out of 45 global cities in Knight Frank's Q1 2025 Prime Global Cities Index, recording a modest 0.2 per cent year-on-year increase in prime residential prices, with prices remaining flat quarter-on-quarter. The city's luxury housing market reflected stability and resilience despite prevailing global economic challenges. Compiled by Knight Frank's global research team, the index tracks the performance of luxury residential markets worldwide. Average annual price growth across the index eased to 2.8 per cent in Q1 2025, down from 3.2 per cent in the previous quarter, reflecting uneven recoveries and sustained macroeconomic pressures globally. "Kuala Lumpur's prime residential segment is showing signs of stabilisation, which is positive in today's environment, but it is not immune to external and domestic pressures," said Enoch Khoo, managing director of Knight Frank Property Hub. "Buyers remain selective, and we are seeing a growing preference for well-located, well-managed properties that align with changing lifestyle needs." Keith Ooi, group managing director of Knight Frank Malaysia, added that while growth remains subdued, the lack of price contraction points to underlying market strength. "That said, the pace of recovery is likely to remain measured in the short term, as market participants continue to respond to interest rate trends, policy signals, and affordability considerations." Despite cautious sentiment—particularly among foreign buyers—demand continues for niche, integrated developments offering connectivity and future-ready infrastructure. Developers are also exercising more discipline in pricing and project delivery, which supports longer-term sustainability. "Malaysia's value proposition – in terms of cost, liveability, and quality of life – remains compelling, particularly for regional buyers looking beyond traditional investment hotspots," added Ooi.
New Straits Times
12-05-2025
- Business
- New Straits Times
Malaysia emerging as attractive diversification market for global investors
KUALA LUMPUR: Malaysia is steadily gaining traction as an attractive diversification market for global investors seeking opportunities beyond traditional hubs, with Japan, South Korea, and Australia continuing to lead capital flows into the Asia-Pacific region. Knight Frank Malaysia group managing director Keith Ooi said there are early indicators of renewed cross-border investor interest, particularly among those re-evaluating the long-term potential of Southeast Asia. "Malaysia offers improving fundamentals, an evolving real estate investment trust (REIT) market, and increasingly transparent regulations. While investor caution remains, the region's overall momentum offers reasons for optimism," he said. Knight Frank's latest Asia-Pacific Capital Markets Insights report revealed that cross-border investment in the region's commercial real estate sector surged to US$9.5 billion in the first quarter of 2025 (Q1 2025), more than doubling year on year. Although Malaysia was not among the top cross-border capital destinations this quarter, Ooi noted a steady increase in investor enquiries—especially targeting Kuala Lumpur, Penang's industrial corridors, and Johor's logistics and residential markets. He said Malaysia's strengths lie in its strong logistics and manufacturing foundation, affordability, and strategic regional location. However, challenges such as currency volatility, evolving regulatory environments, and sector-specific oversupply—particularly in retail and residential—still warrant careful navigation. Knight Frank expects investment momentum to pick up in the second half of 2025, contingent upon economic stability and clearer government policy direction. With US$5.6 billion in deals already captured at the onset of Q2 2025, the market shows promising signs of growth, the firm said. Shifting investment landscape across Asia-Pacific Asia-Pacific's total transaction volume remained resilient at US$33.4 billion in Q1 2025, registering a marginal 0.8 per cent dip compared to the same period last year. However, it marked a 17.1 per cent decline from the strong deal flow seen in Q4 2024. The reduced investment volume in Q1 2025 comes as a contrast to the elevated investment activity witnessed in Q4 2024, where interest rate cuts had prompted investors, who had been cautiously awaiting opportunities, to actively deploy their capital. This surge in investment activity created a high baseline that was difficult to match, leading to the comparatively weaker performance observed in Q1 2025. Despite this, investment momentum persisted, driven by several substantial transactions materialising during the quarter Cross-border capital remains active, accounting for 28.4 per cent of all real estate transactions—the highest proportion since Q3 2023. Knight Frank anticipates stronger activity in the second half of 2025, contingent on stable economic conditions and clearer government policy signals. James Buckley, executive director of Capital Markets – Investments at Knight Frank Malaysia, observed that international investors, previously focused on core markets, are cautiously shifting their gaze towards Malaysia. "We are seeing exploratory interest that could translate into transactions if key policy and macroeconomic indicators stabilise," he said. Buckley believes that these early signs of interest could translate into deal activity, provided Malaysia maintains macroeconomic stability and delivers clearer policy guidance. Regional strength bolstered by resilient office and industrial sectors Craig Shute, the chief executive officer of Asia-Pacific, Knight Frank, said that despite a volatile global backdrop, the region's real estate market showed encouraging performance in early 2025. "Stabilising asset prices and the clear signal that interest rates have peaked encourage investors to support renewed capital deployment. As investors gravitate toward office, industrial, and retail assets that offer resilient income and long-term growth potential, improved financing conditions and clearer valuation floors are helping to restore confidence across key markets," he said. Shute noted that improved financing conditions and clearer asset valuations are helping to restore investor confidence across key markets such as Japan, Australia, and South Korea. By early Q2 2025, the region had already logged US$5.6 billion in deals, pointing to a positive growth trajectory. However, Shute also flagged caution, citing uncertainty surrounding tariffs. "While we anticipate this positive momentum to gather pace, the on-again, off-again tariffs are muddying the outlook for further recovery in the investment landscape. Should tariffs lead to a sustained increase in inflation, the Fed would likely raise interest rates, exerting upward pressure on long-term interest rates and cap rates, potentially dampening capital markets activity globally. "If implemented in full force, the industrial and retail sectors are likely to bear the brunt, with decreasing consumer spending and shifting goods movement directly influencing demand," Shute said. Tariffs could disrupt industrial and retail recovery Christine Li, head of research, Asia-Pacific, Knight Frank, said, should tariffs take full effect, sectors like industrial and retail may bear the brunt. Reduced consumer spending and shifting trade flows would directly impact demand in these segments, she said. Despite these headwinds, Li highlighted the continued strength of the office sector across the region, which demonstrates notable stability, protected by a unique combination of structural advantages and positive market cycles. Cities in Japan and Australia are seeing high occupancy rates and stable rental growth, underpinned by structural advantages and favourable local cycles, she said. "While we anticipate this positive momentum to gather pace, the on-again, off-again tariffs are muddying the outlook for further recovery in the investment landscape." Knight Frank concluded that, while global uncertainties persist, investor confidence across Asia-Pacific real estate markets remains firm—bolstered by selective opportunities, policy shifts, and a growing appetite for diversification into emerging markets like Malaysia.
The Star
06-05-2025
- Business
- The Star
Malaysia sees cross-border investment momentum as Apac investment surges to US$9.5bil
KUALA LUMPUR: Malaysia is cautiously emerging as a diversification market for global investors seeking value beyond mature hubs, with Japan, South Korea, and Australia leading inbound flows, according to Knight Frank Malaysia. In a statement today, Knight Frank said that its latest Asia-Pacific Capital Markets Insights report found that Asia-Pacific's (APAC) cross-border investment in the commercial real estate sector surged to US$9.5 billion (US$1=RM4.18) in the first quarter of 2025 (1Q 2025), doubling year-on-year. Knight Frank Malaysia group managing director Keith Ooi said the research firm is observing early signs of renewed cross-border investor interest in Malaysia, particularly among those reassessing Southeast Asia's growth potential. "Malaysia offers improving fundamentals, an evolving real estate investment trust (REIT) market, and increasingly transparent regulations. While investor caution remains, the region's overall momentum offers reasons for optimism,' he said. The firm noted that while Malaysia was not among the top cross-border capital destinations this quarter, there has been a steady rise in enquiries, particularly for Kuala Lumpur, Penang's industrial corridors, and Johor's logistics and residential hubs. Knight Frank Malaysia executive director of capital markets - investments, James Buckley, said investors who previously focused solely on core markets are now shifting some attention to Malaysia, albeit cautiously. "The industrial and data centre sectors are attracting capital, as are hotels, given the rebound in tourism, which is driving improved occupancy and average daily rates. "We are seeing exploratory interest that could translate into transactions if key policy and macroeconomic indicators stabilise,' he said. Furthermore, Knight Frank anticipates stronger activity in the second half of 2025, contingent on stable economic conditions and clearer policy signals from the government. The firm said that overall transaction volume in APAC held steady at US$33.4 billion in 1Q 2025, easing 0.8 per cent from the same period last year. "However, this reflects a sharper 17.1 per cent decline from the strong activity in 4Q 2024. International investors remain active, with cross-border transactions accounting for 28.4 per cent of all investment activity, the highest proportion since 3Q 2023,' it added. - Bernama
The Sun
29-04-2025
- Business
- The Sun
KL prime office market stable as demand grows
KUALA LUMPUR: Kuala Lumpur's prime office market continues to improve in the first quarter of 2025, as occupier activity strengthens in select sectors despite headline vacancy rates remaining elevated at 24.6%, according to Knight Frank's latest Asia-Pacific Prime Office Rental Index for Q1'25. The city's rental levels held steady at RM6.01 per sq ft per month, with no quarter-on-quarter change – underscoring market resilience in the face of ongoing global and regional uncertainties. Notably, improving occupancy has been observed, bolstered by expansions from technology firms and multinational corporations aiming to reinforce their regional footprint in Malaysia. 'The downward trend of vacancy rates since Q4'23 implied that the office market is getting better and more resilience,' said Knight Frank Malaysia office strategy and solutions senior executive director Teh Young Khean. He added that healthy take up in the market have enhanced the performance of prime office buildings and Kuala Lumpur office market has performed better and no longer ranked as the highest vacancy rate across Apac. 'Stable politics and economy are key drivers of business growth, especially in services,' said Teh. Knight Frank Malaysia group managing director Keith Ooi said: 'Kuala Lumpur is well-positioned to support evolving workplace strategies, particularly as organisations explore hybrid models, cost efficiencies, and future-proofed environments. As trusted advisers, Knight Frank continues to work closely with occupiers to navigate these decisions, ensuring they maximise value in a market that is rich in opportunity.' The report indicates that Kuala Lumpur is part of a broader Southeast Asian trend, where emerging office markets are experiencing steady gains. Tenants across the region are prioritising newer, amenity-rich buildings, and in Kuala Lumpur, this is helping to narrow the gap between available supply and actual demand. Knight Frank also observed that although the city's vacancy rate ranks among the highest in Asia-Pacific, it has remained unchanged quarter-on-quarter, a sign that the market may be reaching an inflection point. With limited new Grade A supply expected in the near term, the market could see a gradual tightening if demand momentum continues. Knight Frank occupier strategy and solutions global head Tim Armstrong commented, 'As companies recalibrate their occupational strategies amid shifting global trade dynamics and economic uncertainties, the focus has turned to portfolio resilience, space efficiency, and long-term value. This evolving approach is prompting greater interest in flexible leasing models and right-sized footprints that support both cost control and workforce adaptability.' With Kuala Lumpur's office market in a period of adjustment, occupiers are urged to seize the opportunity to reposition or upgrade their space requirements. As economic and geopolitical shifts continue to reshape occupier priorities, value and flexibility are emerging as central themes in workplace strategy – and Kuala Lumpur is well positioned to respond. The outlook for the next 12 months suggests continued stability in Malaysia's office sector, with a tenant-favourable market environment expected to persist as businesses reassess long-term space needs and embrace more flexible, future-ready office strategies. With an annual change of 2.6% and a quarterly increase of 0.8%, Kuala Lumpur's office market is showing signs of steady, measured recovery. However, high supply levels and evolving workplace expectations may continue to weigh on rental growth. Occupiers are likely to prioritise flight-to-quality strategies, while landlords may focus on improving building specs and sustainability features to remain competitive in an increasingly discerning market.
