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- Demand in the industrial sector is expected to rise in higher-value industries such as electrical and electronics, semiconductors, data centres and technology-related manufacturing, according to CBRE | WTW’s Malaysia Real Estate Market Outlook 2026 report.
KUALA LUMPUR (Jan 7): The industrial property sector is expected to be the key driver of Malaysia’s real estate market in 2026, according to real estate agency CBRE | WTW.
Demand in the industrial sector is expected to rise in higher-value industries such as electrical and electronics, semiconductors, data centres and technology-related manufacturing, according to the firm’s Malaysia Real Estate Market Outlook 2026 report unveiled on Wednesday.
“This momentum is further reinforced by the rising interest in Malaysia’s manufacturing sector and growing demand for customised, technology-ready industrial facilities,” the agency said.
Demand for industrial space was particularly strong in Johor that recorded RM91.1 billion in approved investments in the third quarter of 2025, surpassing that of Selangor and Kuala Lumpur.
In Penang, industrial investment remains strong, with 146 projects, 78% of which are foreign-backed, and domestic contributing to about 22%. Sarawak, led by Bintulu, is also expanding, with new semiconductor plants and projects in logistics, renewable energy and aerospace engineering.
Real estate investment trusts with industrial assets are likely to benefit from the trend in 2026, especially if the properties meet modern energy and environmental standards, the agency’s managing director Tan Ka Leong told reporters.
“Industrial assets are typically smaller and diversified, so if one is not performing, you have others to leverage,” he noted.
Unlike shopping malls that depend heavily on consumer spending and turnover-based rents, industrial portfolios typically consist of multiple smaller assets that would reduce concentration risk and provide more stable returns.
“Developers are promoting ESG [environmental social governance] features in industrial developments such as solar panels, recycling systems, which is now a must if you want to attract quality tenants,” Tan added.
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