Postponed HSR project could hurt property development in Malaysia

It could likely hit the residential and commercial property segments.

Malaysia’s postponement of the Singapore-Kuala Lumpur High-Speed Railway (HSR) could take its toll on the growth of residential and commercial development in the country, Fitch Ratings said.

Moreover, the suspension of the East Coast Rail Link and the downsizing of the LRT3 project in Kuala Lumpur could also hit the real estate outlook for Malaysia, the research agency added.

“Planned and ongoing large-scale real estate developments, particularly those sponsored by the 1MDB investment fund or ones involving Chinese investors, are likely to come under scrutiny,” they commented.

Also read: Singapore to buoy investment woes from dropped HSR project

Other suspended projects included the work on the US$1.9b Tun Razak Exchange in Kuala Lumpur, which was being built by a 1MDB subsidiary.

“However, the government has since said it would bail out the largely completed project,” Fitch Ratings explained.

The research firm also thinks that earlier-stage projects similar to 1MDB such as the Bandar Malaysia complex may be significantly altered or cancelled.

In addition, those that are backed by Chinese companies or investors could also come under scrutiny, as Mahathir criticized the Forest City complex in Johor during the campaign period and pledged to look into all China-backed projects in the country.

Despite this, Fitch Ratings said that Malaysia’s stable economic will continue to back baseline support for investment in residential, commercial and industrial projects.

Reaching the people who run Asia's businesses is harder than it used to be.

Inboxes are crowded. Attention is short. The executives you most want to reach — the founders, CFOs, and operators who actually move budgets — are the hardest to find through the usual channels. If you're building a company, a category, or a reputation, you already know this.

We've spent twenty years building the room they read. Singapore Business Review is where senior decision makers in Singapore and across Southeast Asia come for business coverage they can't get elsewhere — in print, online, and in person at the summits and roundtables we host across seven markets.

If you have something these readers should know about — a point of view worth publishing, a product worth their attention, an event worth their time — we'd like to hear what you're trying to do.

Book a meeting

| Or download the media kit (PDF)

240,000 senior readers quarterly in print Top 1,700 Singapore companies reached

7 markets across Southeast Asia