Outlook 2023 Malaysia
KEY MESSAGES BRISBANE KUALA LUMPUR
There is approximately 2,644,400 sq ft of new supply across three projects expected to complete in 2023. In total they are 40% pre-committed.
After rebounding from COVID lows in 2021, net absorption is expected to reach 837,843 sq ft in 2022 and 1,956,256 sq ft in 2023. As a result of large amounts of new supply, vacancy is expected to increase to 31% by the end of 2023 and then largely track sideways.
Rents are forecast to decline by 1% in 2022 and then a further 0.5% in 2023 before returning to positive territory in 2024 at 0.75%. This movement will take rents to MYR80 sqft/yr at the end of 2022.
The completion of new, high quality stock enhances Kuala Lumpur’s Financial District – comprising of the city’s newest buildings together with high levels of amenity and integrated transport infrastructure – as a compelling destination for occupiers.
After 2023, new supply is forecast to decline to an average of a little under 500,000 sq ft per year.
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