MANUFACTURING AND E-COMMERCE GROWTH
PAVE THE WAY FOR LOGISTICS SECTOR
By Rachael Raymond
January 2020, Malaysia –
Knight Frank Malaysia launches
its latest research report, Real
Estate Highlights 2nd Half
of 2019 which reviews the
property market performance
across Klang Valley, Penang,
Johor Bahru and Kota Kinabalu. for the repair and maintenance
of roads leading to Port Klang.
Underpinned by increasing global
e-commerce trade and consumer
spending, logistics services are
poised for growth and this will
translate to higher demand for
logistics and warehousing space.
The revival of notable
mega infrastructure projects
in 2019, namely the East Coast
Rail Link (ECRL) and the Bandar
Malaysia project that will house
a station of the Kuala Lumpur
– Singapore High Speed Rail
(HSR) continues to improve
market sentiments and restores
investors’ confidence. In the
southern region, the long-
awaited Johor Bahru – Singapore
Rapid Transit System (RTS) has
also been given the greenlight. Sim,
added,
“We
foresee Selangor and Johor
garnering more interests from
manufacturers and investors
alike.
Allan
Sim,
Executive
Director of Capital Markets,
Knight Frank Malaysia, says,
“These revived projects point
to more clarity in Government
policies and are a boon to
the country’s economy and
construction sector. Growth in the
manufacturing sector is expected
to regain momentum moving
into 2020 after slowing to 3.6% in
3Q2019 against 4.3% in 2Q2019.”
Malaysia’s readiness as a regional
logistics hub is materialising with
impactful on-going projects and
initiatives such as the Digital Free
Trade Zone (DFTZ), the Regional
E-commerce and Logistics Hub
at KLIA Aeropolis, the East
Coast Rail Link (ECRL) and the
West-Coast Expressway (WCE).
The National Budget 2020 also
supports the logistics sector with
the allocation of RM50 million
PROPERTY360DIGEST
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“Industrial players have
a preference for the Shah Alam
– Bukit Jelutong locale due to its
strategic positioning with good
accessibility and connectivity.
However, due to scarcity of
sizeable land and high land
cost, we observed an overspill to
other areas. The on-going West
Coast Expressway (WCE) with
an interchange at Banting to
be completed by early 2021 has
opened up new opportunities
for the locality, attracting the
attention of major logistics
and industrial players. Nestle’s
distribution centre being Phase 1
of Axis Mega Distribution Centre
and the upcoming development
of The COMPASS @ Kota Seri
Langat are both located herein.”
Penang
Penang was the top recipient of
foreign direct investment (FDI)
inflow into Malaysia. In the
first nine months of 2019, the
state garnered RM13.2 billion in
total approved manufacturing
investments (RM12 billion FDI
and RM1.2 billion domestic
investments) from 113 projects,
surpassing the RM5.78 billion
achieved for the entire year in
2018. Tay Tam, Resident Director
of Knight Frank Penang, says,
“This is a tremendous boost
to the state and augurs well
for the short and medium-
term growth of the sector.
“The outlook for 2020 is
very positive. In tandem with
robust performance of the
manufacturing sector and the
e-commerce platform, demand
for logistics and warehousing
facilities is set to grow in the
coming year too,” added Tam.
Johor Bahru
According to Iskandar Regional
Development Authority (IRDA),
the manufacturing sector was
leading the numbers among the
sectors and contributed 24% to
the total cumulative investment
for the region as of June 2019.
Debbie
Choy,
Branch
Head of Knight Frank Johor,
says, "We have seen significant
industrial transactions in the
Port of Tanjung Pelepas (PTP) and
Nusajaya Tech Park, proof that
these areas are popular among
investors and industrialists due
to their established facilities
and infrastructure. We are also
pleased to share that Knight
Frank successfully facilitated the
concluded deal of the Specialized
Technology Resource (Malaysia)
Sdn Bhd’s factory in PTP.
“The outlook for the industrial
market is one of optimism with
2019 witnessing the listings of two
Johor- based industrial players,
namely AME Elite Consortium
and Spring Art Holdings Sdn
Bhd, in Bursa Malaysia. This is