Johor’s emergence as a strategic industrial and logistics node continues to gain traction, underscored by DHL Supply Chain Malaysia’s opening of its South Region Hub 2 in Senai Airport City. The expansion follows the full occupancy of South Region Hub 1, which began operations earlier in 2025, and reflects sustained demand from technology-driven multinational corporations operating in southern Malaysia.
Rather than a standalone facility, Hub 2 forms part of a sequential development strategy that mirrors broader structural shifts in regional supply chains. As manufacturing, data infrastructure and cross-border trade intensify, logistics capacity is increasingly being built around integrated ecosystems rather than isolated warehouses.
Senai Airport City as an industrial logistics anchor
Senai Airport City has positioned itself as a core industrial zone within Iskandar Malaysia, leveraging proximity to expressways, ports, Senai International Airport and Singapore’s Changi Airport. The development’s scale — spanning over 2,700 acres — allows it to host a mix of manufacturing, logistics, and export-oriented activities within a single master-planned environment.
The completion of DHL’s second hub within one year of groundbreaking reflects the readiness of infrastructure and demand alignment in the zone. Unlike speculative logistics developments, Hub 2 was delivered with committed occupiers already in place, indicating demand-led expansion rather than supply push.
From a kl property perspective, such developments illustrate how industrial real estate growth is increasingly tied to ecosystem depth rather than headline announcements.
The role of Hub 1 and regional control functions
South Region Hub 1 plays a strategic role beyond physical logistics. It houses DHL’s regional Control Tower, providing centralized coordination and real-time visibility across supply chains spanning Malaysia, Singapore and Thailand.
This function supports increasingly complex, multi-country manufacturing and distribution models. Rather than managing operations in silos, companies are centralising decision-making and monitoring to improve responsiveness and reduce disruption risks.
The fact that Hub 1 reached full occupancy relatively quickly suggests strong demand for logistics infrastructure that integrates digital visibility with physical movement of goods.
Why Hub 2 matters
South Region Hub 2 adds nearly 19,000 square metres of logistics space and is fully occupied by investors operating within Senai Airport City. Its design supports advanced manufacturing and technology-driven supply chains, which typically require higher specifications than conventional warehousing.
These supply chains often serve industries such as electrical and electronics, precision manufacturing, automotive components and technology hardware. Such sectors place greater emphasis on speed, reliability and integration with production facilities.
The development of Hub 2 demonstrates how logistics capacity is being scaled incrementally, matching occupier growth rather than overshooting demand.
Sustainability as infrastructure baseline
Hub 2 incorporates sustainability features including solar panels, smart LED lighting and rainwater harvesting systems. While such measures are increasingly standard, they are becoming more than compliance features.
Large multinational occupiers now factor environmental performance into site selection, driven by internal ESG targets and supply chain reporting requirements. Logistics facilities that fail to meet baseline sustainability expectations risk obsolescence sooner than anticipated.
From an investment standpoint, sustainability-linked infrastructure reduces long-term asset risk and supports tenant retention, particularly for globally integrated supply chains.
Johor’s multiplier effect
The back-to-back development of DHL’s two hubs illustrates the multiplier effect within established industrial zones. Once anchor tenants commit, supporting logistics, services and ancillary industries tend to follow.
This dynamic is particularly visible in Johor, where manufacturing growth is supported by logistics capacity, which in turn reinforces the attractiveness of the location for additional investment. The result is a reinforcing loop rather than isolated project success.
Such ecosystems contrast with earlier industrial developments that relied heavily on single-sector concentration without adequate logistics or support infrastructure.
Occupier profile signals market direction
The presence of companies such as Wiwynn, Shenghuabo and Mercedes-Benz among investors linked to Senai Airport City reflects the nature of demand. These firms operate in technology manufacturing, automotive supply chains and advanced industrial processes.
Their logistics requirements are typically less labour-intensive but more capital- and technology-heavy, aligning with Johor’s positioning as a hub for higher-value industrial activity rather than low-cost assembly.
This shift has implications for land use, infrastructure planning and industrial real estate design, favouring quality, scale and integration over sheer volume.
Implications for industrial real estate
Johor’s logistics market is moving beyond basic warehousing into more specialised facilities that support complex operations. For developers and investors, this raises the bar for design, specification and location.
Facilities need to integrate transport access, digital systems, energy efficiency and scalability. Zones that can offer “plug-and-play” readiness with utilities, free zone status and regulatory clarity gain a competitive edge.
At the same time, fully occupied developments such as DHL’s hubs suggest that demand remains strong when assets are aligned with occupier needs.
Regional supply chain realignment
The expansion of logistics capacity in Senai also reflects broader regional supply chain adjustments. Companies are diversifying manufacturing and distribution footprints under “China Plus One” strategies, with Southeast Asia benefiting from this reallocation.
Johor’s proximity to Singapore provides access to financial, logistical and talent networks while offering cost advantages and space availability. Logistics hubs that bridge this cross-border dynamic play a critical role in sustaining regional supply chains.
As trade patterns evolve, logistics infrastructure that supports flexibility and cross-border integration becomes increasingly valuable.
A measured expansion, not a speculative surge
Notably, the development of Hub 2 does not signal unchecked expansion. Instead, it reflects measured capacity growth supported by committed occupiers and ecosystem maturity.
This approach reduces the risk of overbuilding and aligns capital deployment with actual usage. For investors, such discipline suggests a healthier market dynamic than rapid, speculative supply additions.
Looking ahead
The opening of DHL South Region Hub 2 reinforces Johor’s role as a logistics and industrial anchor within Malaysia’s economic landscape. It also highlights how global logistics players are deepening their presence where infrastructure, policy alignment and occupier demand converge.
For the broader kl property and industrial real estate market, the key takeaway is not the size of the facility, but the structure of demand it represents: integrated, technology-driven and ecosystem-based.
As Malaysia continues to attract manufacturing and digital infrastructure investment, logistics hubs that support these sectors will remain central to long-term industrial growth. Johor’s experience suggests that when planning, infrastructure and demand align, expansion can be both rapid and sustainable.
