Office: Although demand improved after Covid-19 pandemic, new supply entered the market hastily than demand can absorb. There is approximately 4.92 million sf notable incoming supply to be injected within next 3 years, adding experts’ concern on the over-supply situation. Furthermore, the new vs old office building competition is making it more difficult for landlords to raise rent especially those buildings with low occupancy rate.
Retail: It is notable that average vacancy rate continues declining to 18.5% in Q2 2023 (Q1'23: 19.47% and Q4'22: 21.23%), however, the rental for prime shopping centre remain stable within range of RM45.00 to RM215.00 per sf per month and represents rise of 1.77% y-o-y.
Industrial: Malaysia’s IPI contracted by 3.3% in April 2023, attributed by all sectors namely Mining with 4.9% (March 2023: 0.8%), Manufacturing with -3.0% (March 2023: 4.1%) and Electricity with -2.0% (March 2023: 0.4%). In comparison with the preceding month, the IPI declined by 10.8% after registering a growth of 8.4% in March 2023. The deterioration of Manufacturing sector was its first contraction since July 2021, influenced by almost all subsectors except for Textiles (+2.5%) and Non-metallic Mineral, Basis and Fabricated Metal (+3.3%).
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