2021 Real Estate Market Outlook Malaysia
Total Page:16
File Type:pdf, Size:1020Kb
20 21 REAL ESTATE MARKET OUTLOOK MALAYSIA CIFIC PA www.cbre ASIA | R E S TA R T - T H E U N E V E N R E C OV E RY w tw. co m.m y RESEARCH | WTW CBRE CBRE | WTW RESEARCH | ASIA PACIFIC © 2021 CBRE | WTW A S I A P A C I F I C R E A L E S T A T E 1 M A R K E T OUTL OOK 2 0 2 1 INTRODUCTION ‘’The pandemic will not vanish overnight, so I think we still will be dancing Tango with the pandemic in 2021, where a step forward of opening up the economy will be accompanied by another step backward of movement control if the cases surge. All said, I am confident we will make positive progress in the year ahead, I am hopeful that macroeconomic recovery will be forthcoming and the pandemic will be better-contained with vaccines coming into play. There might not be strong growth for the coming years but Sr FOO GEE JEN we could still look forward to gradually restoring normalcy GROUP MANAGING DIRECTOR CBRE | WTW and regaining certainty in 2021’’ FORMATION In 1975, C H Williams Talhar Wong & Yeo CBRE | WTW entered into an agreement in May (WTWY) was established in Sarawak. C H Williams 2016 to form a joint venture to provide a deep, Talhar & Wong (Sabah) (WTWS) was established in broad service offering for the clients of both firms. 1977. This combines Malaysia’s largest real estate services provider, WTW’s local expertise and in- depth relationships in Malaysia with CBRE’s global The current management is headed by Group reach and broad array of market leading services. Chairman, Mohd Talhar Abdul Rahman. The union of CBRE and WTW is particularly The current Managing Directors of the WTW significant because of our shared history. In Group operations are: the1970s, CBRE acquired businesses from WTW in • Singapore and Hong Kong, which remain an CBRE | WTW: Mr. Foo Gee Jen integral part of CBRE’s Asian operations. • C H Williams Talhar & Wong (Sabah) Sdn Bhd: Mr. Leong Shin Yau The wider WTW Group comprises a number of • subsidiaries and associated offices located in East C H Williams Talhar Wong & Yeo Sdn Bhd: Malaysia including: Mr. Robert Ting Kang Sung • C H Williams Talhar Wong & Yeo Sdn Bhd ABOUT CBRE (1975) • C H Williams Talhar & Wong (Sabah) Sdn Bhd CBRE Group, Inc. (NYSE:CBG), a Fortune 500 (1977) and S&P 500 company headquartered in Los • C H Williams Talhar & Wong (Brunei) Sdn Bhd Angeles, is the world’s largest commercial real ABOUT WTW estate services and investment firm (in terms of 2014 revenue). The Company has more than Colin Harold Williams established C H Williams & 70,000 employees (excluding affiliates), and Co in Kuala Lumpur in 1960. C H Williams & serves real estate owners, investors and occupiers Company merged in 1974 with Talhar & Company through more than 400 offices (excluding founded by Mohd Talhar Abdul Rahman and the affiliates) worldwide. CBRE offers strategic advice inclusion of Wong Choon Kee to form C H and execution for property sales and leasing; Williams Talhar & Wong (WTW). corporate services; property, facilities and project management; mortgage banking; appraisal and valuation; development services; investment management; and research and consulting. CBRE | WTW RESEARCH | ASIA PACIFIC © 2021 CBRE | WTW A S I A P A C I F I C R E A L E S T A T E 2 M A R K E T OUTL OOK 2 0 2 1 CONTENTS 03 60 ECONOMY & INDUSTRIAL UPDATES ON MAJOR POLICY / INFRASTRUCTURE 07 72 MARKET OVERVIEW HOTEL 19 84 RESIDENTIAL SIGNIFICANT TRANSACTIONS 37 89 OFFICE OUR NETWORK 49 RETAIL CBRE | WTW RESEARCH | ASIA PACIFIC © 2021 CBRE | WTW UPDATES ON ECONOMY & MAJOR POLICY / INFRASTRUCTURE CBRE | WTW RESEARCH | ASIA PACIFIC © 2021 CBRE | WTW A S I A P A C I F I C R E A L E S T A T E 4 M A R K E T OUTL OOK 2 0 2 1 MALAYSIA’S ECONOMY ECONOMIC ACTIVITY RECOVER LOW INTEREST RATE ENVIRONMENT Malaysia recorded a Gross Domestic Product (GDP) Malaysia maintained a low interest rate environment with contraction of -2.7% in 3Q 2020 q-o-q as compared to the latest Overnight Policy Rate (OPR) at 1.75% as at 3Q 2Q 2020 (-17.1%). Nevertheless, Bank Negara 2020, the lowest in history. The low interest rate will be Malaysia (BNM) anticipates a contraction between - maintained in 2021 to stimulate economic recovery. 3.5% and -5.5% of GDP growth in 2020. Financing activity continues to grow. The total number of applied loans increased 2% while loan approval rate In terms of recovery momentum, manufacturing (3.3%) hovered at a maintained level of 41.8%. and construction (-12.4%) showed the strongest resilience and improved recovery as compared q-o-q GOVERNMENT FINANCIAL AID BUT STILL AN from 2Q 2020. This is followed by mining and UNEVEN RECOVERY quarrying (-6.8%) and services (-4%). Only agriculture recorded negative growth by -1.7% as compared to Since the pandemic outbreak, some financial aid 2Q. packages announced by the Government were Prihatin, Prihatin Small and Medium Enterprise (SME)+, Short- The Consumer Sentiments Index (CSI) improved 9% Term Economic Recovery Plan (PENJANA) and Kita while the Business Confidence Index (BCI) increased Prihatin, and Loan Moratorium to assist SMEs. An 25%. The Consumer Price Index (CPI) hovered at 120 extension or loan rescheduling was also proposed in points and the Industrial Production Index (IPI) was 0.8 Budget 2021 to ease financial stress. points in 3Q 2020, a marginal decrease y-o-y. The Economy will continue to recover unevenly Net Exports increased by 11% y-o-y as at 3Q 2020, throughout 2020 / 2021 with the industrial sector taking creating a trade surplus of RM60 billion mainly the lead. Slow improvement is expected for aviation, supported by manufacturing and agriculture goods. hotel and tourism sectors. In realizing that Malaysia’s Foreign Direct Investment (FDI) was recorded at unemployment rate and SME sentiments are important RM51billion as at 3Q 2020 as compared y-o-y (RM27 drivers of Malaysia’s GDP, the Government had billion). allocated RM1.5 billion to stimulate the employment. Malaysia’s participation in the Regional Comprehensive Economic Partnership (RCEP) will be beneficial for the long-term. CONTRIBUTION OF EXPENDITURE COMPONENTS TO REAL GDP GROWTH GDP GROWTH BY SECTORS 300,000 5.0 250,000 216,049 1Q 1Q 2019 2Q 2019 3Q 2019 4Q 2019 1Q 2020 2Q 2020 3Q 2020 200,000 175,421 160,655 -5.0 150,000 RM Million 100,000 Real Real GrowthGDP (%) -15.0 51,435 50,000 -17.1 0 2Q 2019 3Q 2019 4Q 2019 1Q 2020 2Q 2020 -25.0 Agriculture Mining and Quarrying Private Activities Public Acivities Manufacturing Construction Services GDP Exports of Goods & Services Imports of Goods & Services Source: Bank Negara Malaysia, CBRE | WTW Research Source: Bank Negara Malaysia, CBRE | WTW Research CBRE | WTW RESEARCH | ASIA PACIFIC © 2021 CBRE | WTW A S I A P A C I F I C R E A L E S T A T E 5 M A R K E T OUTL OOK 2 0 2 1 MAJOR POLICY UPDATES MAJOR POLICY AUTHORITY / EFFECTIVE DESCRIPTION REMARKS AGENCY DATE Fund for Affordable Bank Negara Malaysia 1 September 2019 Maximum monthly household income increased to Homes (BNM) to 31 December RM4,360, maximum property unit price increased to 2020, or until the RM300,000. fund is exhausted. Real Property Gains Ministry of Finance (MOF) Exemption until 31 Exemption is applicable for Malaysia citizens, of Tax (RPGT) December 2021 disposal up to 3 residential properties from 1 June (Gazette on 28 2020 to 31 December 2021. July 2020) Stamp Duty Ministry of Finance (MOF) 1 June 2020 – 31 A full exemption given on loan agreement effective Exemption May 2021 signed between June 2020 to May 2021 1 June 2020 – 31 For transfer and loan agreement for the purchase of May 2021 residential home priced between RM300,000 to RM2.5 million. For transfer instrument limited to the first RM1 million property prices only. 1 Jan 2021 – 31 Exemption to both transfer and loan agreement for Dec 2025 the purchase of a first home worth not more than RM500,000 Quit Rent Federal Territories Land 1 January 2020 Quit rent for strata properties will now be payable and Mines Office individually, to be known as Parcel Rent. Minimum Value of Sarawak Government 23 May 2019 The prescribed amount for foreign acquisition of Property for Foreign landed residential property shall be not less than Acquisition (revision) RM500,000 (throughout the State of Sarawak except in Sarawak Kuching), and shall be not less than RM600,000 for Kuching Division. Minimum Value of Sabah Government 1 January 2020 The threshold level for residential home ownership by Residential Home foreigners have been lowered to RM750,000 from Ownership by RM1 million. Applicable only for residential homes Foreigners in Sabah that have been issued with Occupation Certificate and remain unsold for more than 9 months. CBRE | WTW RESEARCH | ASIA PACIFIC © 2021 CBRE | WTW A S I A P A C I F I C R E A L E S T A T E 6 M A R K E T OUTL OOK 2 0 2 1 INFRASTRUCTURE UPDATES MAJOR INFRASTRUCTURE COMPLETION PROJECTS LOCATION REMARKS YEAR RAIL East Coast Rail Link (ECRL) Tumpat-Kuantan-Mentakab- 2026 Under construction Jelebu-Port Klang Electrified Double Track Project Gemas – Johor Bahru 2021 Under construction (EDTP) Gemas-Johor Bahru Rapid Transit System (RTS) Bukit Chagar – Woodlands, 2026 Construction kick-start Singapore LRT Line 3 Bandar Utama – Klang 2024 Under construction MRT 2 (SSP Line) Sungai Buloh – Serdang – 2021 Under construction Putrajaya HIGHWAY / EXPRESSWAY Damansara – Shah Alam Puncak Perdana – Kota 2021 Under construction Highway (DASH) Damansara – Penchala East Klang Valley Expressway Cheras – Hulu Langat – Ampang 2021 Under construction (EKVE) Lebuhraya Putrajaya-KLIA MEX – KLIA – KLIA 2 2020 Contract awarded (MEX II) Pan-Borneo Highway