Bandar Malaysia Settles with Sim Leisure After Terminating Escape Theme Park Deal

The long-anticipated Bandar Malaysia mega-development has taken another decisive turn. Its state-owned developer, Bandar Malaysia Sdn Bhd, has agreed to pay compensation to Sim Leisure Group Ltd following the termination of a deal to build and operate an Escape theme park within the project site.

The agreement brings closure to months of dispute and clears the path for Bandar Malaysia to proceed with a reconfigured development plan, after the 486-acre site was sold to Petronas’ KLCC Holdings Sdn Bhd last year.

The Settlement Agreement

According to a filing by Sim Leisure on the Singapore Exchange:

How the Conflict Arose

In November 2023, Sim Leisure signed an agreement to develop a 75-acre Escape theme park in Bandar Malaysia, envisioned as a family-friendly anchor attraction within the massive mixed-use township.

However, the arrangement unraveled after:

Bandar Malaysia sold the 486-acre former Sungai Besi airbase site to Petronas’ KLCC Holdings Sdn Bhd in 2024.
Sim Leisure then received a termination notice, claiming breach of obligations.
The company alleged Bandar Malaysia acted unfairly, sparking the need for compensation negotiations.

Bandar Malaysia’s Transformation

The Bandar Malaysia project is one of Malaysia’s most high-profile developments:

Size: 486 acres, located just off Jalan Sungai Besi, 7km from KLCC.
Origin: Former Royal Malaysian Air Force base.
Masterplan: Envisioned as a RM140 billion transit-oriented city, anchored by:
- Residential and commercial towers.
- Mega retail hubs.
- Transport links including future HSR (high-speed rail) integration.

The sale to Petronas via KLCC Holdings signals a shift towards a potentially energy, sustainability, and corporate HQ-driven precinct, aligning with Petronas’ long-term real estate strategy.

The removal of Escape theme park suggests that Bandar Malaysia’s future focus may tilt less towards entertainment tourism, and more towards corporate, mixed-use, and technology-led urban functions.

Implications for Investors and KL Property

1. Clearer Project Roadmap

The settlement eliminates legal uncertainty. For investors watching Bandar Malaysia, this provides assurance that disputes will not hinder progress.

2. Petronas-Led Development Direction

With KLCC Holdings now holding the land, Bandar Malaysia could mirror the success of KLCC City Centre, with a focus on:

Corporate offices.
Hospitality.
High-end residential.
Integrated retail.

This creates potential property value uplift across Kuala Lumpur’s southern corridor.

3. Shift Away from Entertainment Anchors

Without the Escape park, the development may lose a tourism-centric component. But for property buyers and investors, the upside lies in a more business-driven, sustainable urban fabric akin to TRX and KLCC.

4. Surrounding Market Boost

Nearby areas — Sungai Besi, Cheras, Kuchai Lama, and Old Klang Road — stand to benefit from infrastructure and spillover demand. Transit upgrades linked to Bandar Malaysia could raise property values by 15–25% over the medium term.

Market Insights

Greater KL Mega-Projects Driving Property Demand

Bandar Malaysia joins a list of transformational projects shaping Kuala Lumpur’s skyline:

Merdeka 118 Precinct – offices, Park Hyatt, 118 Mall.
TRX (Tun Razak Exchange) – Malaysia’s international financial district.
Bukit Jalil Sentral (MRCB-led) – a RM21 billion mixed-use hub.

For investors, these projects demonstrate how mega-developments act as anchors of property appreciation across the city. Bandar Malaysia, with Petronas’ backing, could become another prime catalyst.

Tourism vs Corporate Focus

Langkawi, Penang, and Genting remain Malaysia’s entertainment tourism hotspots. Kuala Lumpur’s future positioning, however, is tilting towards:

Business tourism (MICE).
Sustainable corporate hubs.
Transit-oriented residential communities.

Bandar Malaysia’s pivot away from an amusement park fits this evolving narrative.

Investor Considerations

Luxury Condos & Residences
Expect future branded residences and luxury apartments within Bandar Malaysia to target high-net-worth locals and expatriates. Investors in KLCC and TRX should anticipate competition but also stronger overall positioning for KL as a global city.
Commercial & Office Space
Petronas’ involvement suggests future demand for Grade A offices, possibly attracting energy, technology, and finance companies.
Transit-Oriented Property
With Bandar Malaysia likely linked to MRT and (eventually) the HSR, nearby residential neighbourhoods such as Sungai Besi and Kuchai Lama may enjoy a premium uplift.

Conclusion

The settlement between Bandar Malaysia and Sim Leisure Group brings closure to a dispute over the cancelled Escape theme park project, with Sim Leisure receiving compensation and exiting the site.

For Bandar Malaysia, this marks a strategic reset: moving away from entertainment-led components and towards a Petronas-driven vision of a corporate and mixed-use urban hub.

For investors, the implications are significant. With the legal dust settled and Petronas’ financial strength in play, Bandar Malaysia has renewed potential to become one of KL’s most valuable addresses. Surrounding property markets, particularly in the Sungai Besi corridor, will likely benefit from this momentum.

The bottom line: while Kuala Lumpur loses an amusement park, it gains clarity and the backing of a national champion — paving the way for Bandar Malaysia to re-emerge as a defining mega-project for the city’s future.