Johor Consolidates Position as Malaysia’s Second-Largest Residential Market
Johor has firmly established itself as Malaysia’s second-largest residential property market in 2025, trailing only Selangor, based on both transaction volume and value.
In the third quarter of 2025, the southern state recorded 10,500 residential transactions with a combined value of RM5.49 billion, outperforming the national average and several other key markets.
For comparison, Selangor posted 14,560 transactions worth RM8.47 billion, Kuala Lumpur recorded 3,789 transactions valued at RM3.45 billion, while Penang saw 4,614 transactions totaling RM2.13 billion during the same period.
According to JLL Malaysia managing director and head of value and risk advisory Jamie Tan, Johor’s sustained momentum reflects structural demand drivers rather than short-term speculation.
“Johor continues to outperform the national trend, supported by the Johor–Singapore Special Economic Zone (JS-SEZ) and broad-based infrastructure upgrades,” Tan said during JLL’s 4Q2025 property market media presentation.
Residential demand has also benefited from spillover effects linked to the rapid expansion of data centre, industrial and logistics activities across the state.
Signs of Market Consolidation
Despite its strong quarterly performance, Johor’s residential market recorded a year-on-year consolidation, with transaction volume and value declining by approximately 17% and 6% respectively.
This moderation suggests the market may be entering a phase of healthy correction and recalibration, rather than a structural slowdown, as buyers become more selective amid higher interest rates and affordability considerations.
Industrial Land Prices Continue to Climb
Johor’s industrial property segment remains one of the strongest performers, with industrial land prices continuing their upward trend in 2025.
JLL Malaysia logistics and industrial senior manager Derek Yap said average industrial land prices reached RM86 per sq ft, representing an 8.4% year-on-year increase from RM79 per sq ft in 2024.
This marks a steady recovery trajectory since 2020, with values now approaching pre-pandemic levels, signalling improved market stability.
Key industrial clusters driving demand include Iskandar Puteri–Tanjung Pelepas and Kulai–Senai, supported by strong occupier interest and regional diversification strategies such as the China Plus One approach.
Major industrial parks attracting tenants include SiLC Nusajaya, Nusajaya TechPark, Senai Industrial Park, i-Park@Indahpura, Johor Technology Park, Pasir Gudang Industrial Park, and Tanjung Langsat Industrial Complex.
These zones continue to draw occupiers from sectors such as electrical and electronics (E&E), logistics, automotive, medical devices, fast-moving consumer goods (FMCG) and data centre supply chains.
While rental growth is expected to remain modest in 2026 due to incoming supply, Yap noted that vacancy levels remain low in prime locations, with landlords offering incentives and concessions to stay competitive.
Local institutional investors and Malaysian REITs continue to dominate acquisitions, focusing on high-quality logistics and industrial assets in strategic locations to strengthen portfolio resilience.
Nusajaya and Kulai Anchor Johor’s Data Centre Expansion
Johor’s data centre landscape is undergoing rapid transformation, with Nusajaya emerging as a premium data centre hub, benefiting from its proximity to Singapore via the Tuas Second Link.
JLL Malaysia capital markets manager Sum Chun Kit said Nusajaya’s strategic location and improving infrastructure have positioned it as a preferred destination for hyperscale and enterprise data centre operators.
Meanwhile, Sedenak hosts one of Southeast Asia’s largest purpose-built data centre parks, featuring dedicated power and water infrastructure. Phase One is fully operational, while Phase Two is expected to launch soon.
Nearby Kulai is also gaining prominence, with YTL Corp Bhd developing a 500-megawatt data centre campus, intended to serve major technology players including SEA Ltd and Nvidia Corporation.
However, Sum cautioned that existing industrial infrastructure in some areas was not originally designed for data centre use, requiring substantial investment to upgrade power, water and grid capacity.
The concentration of data centres has placed significant pressure on local utilities, prompting operators to explore alternative locations such as Tebrau, Ulu Tiram and Pasir Gudang to distribute capacity more evenly across the state.
Long-Term Outlook Remains Positive
While Malaysia’s data centre sector is currently undergoing strategic consolidation, Sum noted that the long-term outlook remains highly positive.
The expansion is underpinned by strong regional fundamentals, including accelerating digitalisation, cloud migration, artificial intelligence adoption, and rising demand for high-performance computing infrastructure across Southeast Asia.
Looking ahead, deeper public-private collaboration, sustainable infrastructure planning and phased capacity expansion are expected to play a crucial role in supporting Johor’s continued growth as a regional residential, industrial and digital infrastructure powerhouse.
