“Malaysia’s property sector forecasted to grow in 1Q25, with high-end residential and industrial land sales driving earnings. Analysts highlight data centre deals, new launches, and steady demand.“
Kuala Lumpur, 21th Apr 2025, 11.55am – Malaysia’s property sector is expected to maintain steady momentum in the first quarter of 2025 (1Q25), supported by firm earnings from the previous quarter and continued investor interest in residential and industrial developments, analysts say.
Veteran investor Ian Yoong forecasts property sector earnings to grow between 8% and 12% in 1Q25, attributing the positive outlook to strong land sales booked in the fourth quarter of 2024 (4Q24).
“Malaysia’s emergence as the fourth most popular global destination for ultra-high-net-worth Chinese homebuyers in 2024 is a key signal,” Yoong told StarBiz. “This trend will drive further demand in the high-end residential market, especially for homes priced at US$5 million and above.”
He also anticipates overall property sales to rise between 4% and 6% this year, led by the residential and industrial segments.
Mixed Views on 1Q25 Earnings
While optimism remains, some analysts caution that seasonal disruptions may temporarily soften earnings in 1Q25.
RHB Investment Bank analyst Loong Kok Wen noted that quarterly performance may dip due to festive season impacts on construction activity.
“Developers often delay new launches until late Q2, after Chinese New Year and Hari Raya, which tend to interrupt construction workflows,” Loong said. “This pattern typically results in stronger second-half sales.”
Despite the potential quarterly softness, she expects property sales to grow 3% to 5% in 2025, continuing the sector’s strong post-pandemic trajectory.
Sustained Sales and Stronger Industrial Pipeline
According to UOB Kay Hian Research, developers have set higher sales targets for 2025, supported by robust demand and progressive billings.
The firm projects:
- 8.4% year-on-year revenue growth
- 9.1% earnings growth, buoyed by higher-margin industrial land sales
“Many listed developers exceeded their 2024 targets, including S P Setia, Sunway, and UEM Sunrise, which outperformed by up to 42%,” UOBKH said. “Others, like Mah Sing and Lagenda Properties, were slightly below target due to delayed launches.”
The research house believes industrial land deals will be a key earnings driver, estimating:
- RM600 million in industrial sales revenue in 2025
- RM900 million in 2026, contributing 15% to 20% of total sector earnings
Upcoming catalysts include:
- IOI Properties eyeing a major data centre land deal by June 2025
- S P Setia targeting RM200–300 million in industrial sales
- Mah Sing finalising a 42-acre land sale in Meridin East, Johor, with Bridge Data Centre expected to close by end-May
Global Uncertainty Remains a Risk
Loong flagged that global economic uncertainty, particularly around US tariff policies, could impact sentiment, especially for industrial-focused developers.
“Multinational companies might delay expansion decisions pending greater clarity,” she said, though she noted that the residential segment remains resilient and unlikely to face a major downturn.
Long-Term Sector Outlook Positive
Despite short-term volatility, analysts are generally bullish on Malaysia’s long-term property outlook, pointing to sustained investor appetite and rising demand for quality urban and industrial spaces.
UOBKH maintains a positive stance, favouring:
- IOI Properties, which is eyeing a real estate investment trust (REIT) listing in 2H25
- Eco World Development Group Bhd for its exposure to high-growth industrial and commercial assets
- Mah Sing, which may benefit from the finalisation of its data centre deal and a possible land acquisition in Johor
