KL-Singapore High-Speed Rail Project Ignites Optimism for Johor Property Sector Growth

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KL-Singapore High-Speed Rail Project

Explore the property sector’s potential surge with the Kuala Lumpur-Singapore HSR project, offering growth opportunities in Johor for developers like UEM Sunrise, Sunway, and Eco World.

KUALA LUMPUR, 29th Jan 2024 – The anticipated Kuala Lumpur-Singapore High-Speed Rail (HSR) project is poised to significantly impact the property sector, particularly in Iskandar Malaysia, Johor, and the Kuala Lumpur city center, along with regions surrounding HSR stations.

RHB Research predicts a substantial boost to railway infrastructure in Johor, particularly if the government proceeds with planned projects like the light rail transit (LRT) and HSR. This development is expected to drive demand for residential, commercial, and industrial properties in Iskandar Malaysia, resulting in an escalation of land parcel prices.

Identifying UEM Sunrise Bhd as a key player, RHB Research suggests Sunway Bhd, IOI Properties Group Bhd, and Eco World Development Group Bhd as potential beneficiaries due to their strategic landbank exposure near the Second Link and Kulai.

With an ongoing “overweight” stance on the property sector, RHB Research emphasizes the importance of rail transit systems in making the Johor-Singapore special economic zone more attractive.

The completion of the Johor Baru–Singapore Rapid Transit System (RTS) by 2026, coupled with the proposed LRT, is expected to enhance inter-city railway connectivity and cater to rising passenger traffic from Singapore. With a current population of 4.01 million in Johor and 5.5 million in Singapore, the LRT and HSR projects could transform Southern Johor into a major city comparable to the Klang Valley in the long run.

The HSR is seen as a significant catalyst for increasing southbound human traffic, not only between Malaysia and Singapore but also among international travelers, facilitated by potential connectivity between Kuala Lumpur International Airport and Changi Airport.

Johor stands to benefit the most, with more than half of the HSR track passing through the state. Proposed LRT lines and terminal stations, potentially at Ikea Tebrau, Iskandar Puteri (Legoland or Forest City), and Senai, along with HSR stations at Iskandar Puteri or Forest City, are expected to further spur growth.

RHB Research identifies Tuas Link as a hotspot for growth opportunities due to the concentration of the new transport system, while the Johor central region is considered relatively more saturated. Major landowners in the region, such as UEM Sunrise and Sunway, are well-positioned to capitalize on these opportunities, with Eco World having recently replenished its land holdings in the area.

UEM Sunrise emerges as a prime beneficiary, especially if Iskandar Puteri is confirmed as the location for the last HSR station in Malaysia, as proposed in earlier plans. The research house remains optimistic about the potential of these developments, signaling positive prospects for Johor’s property market.

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