Malaysia’s property outlook constructive in 2H 2025 with multi-segment growth

KUALA LUMPUR: Malaysia’s property outlook for the second half of 2025 remains constructive with ample opportunities across multiple segments according to Hong Leong Investment Bank Bhd.

The investment bank highlighted that the Johor-Singapore Special Economic Zone is expected to spur industrial demand in Johor benefiting IOI Properties Group Bhd while also supporting residential growth for Sunway Bhd and UEM Sunrise Bhd.

The upcoming Johor Bahru-Singapore Rapid Transit System commencement should further uplift residential demand near stations benefiting Sunway and Mah Sing Group Bhd while boosting retail spending from Singaporeans.

In Negeri Sembilan the industrial segment gains momentum as the state positions itself as a cost-competitive alternative to Selangor with Matrix Concepts Holdings Bhd and Sime Darby Property Bhd well-placed to capture demand.

HLIB noted that Matrix is already seeing robust uptake for new industrial launches in its Malaysia Vision Valley township.

Additionally the office sector shows signs of recovery benefiting landlords such as Sunway and IOI Properties.

Malaysia’s stable political environment enhances its appeal as a tourism destination relative to peers such as Thailand and Indonesia benefiting hospitality players with strong exposure to hotels malls and theme parks notably IOI Properties and Sunway.

HLIB maintained its overweight rating on the property sector citing a multi-year upcycle driven by rising household incomes policy tailwinds and Malaysia’s transition toward a high-value economy.

The sector has undergone a structural transformation in recent years with new opportunities emerging in industrial retail office and hospitality segments.

Investors should view the sector through a broader lens beyond just residential demand to capture these new growth avenues according to the investment bank.

This diversification provides developers with multiple growth pillars and new revenue streams strengthening earnings visibility and reducing reliance on any single segment.

HLIB’s top picks are IOI Properties OSK Holdings Bhd Sunway and Sime Darby Property. – Bernama