RHB Investment Bank Bhd (RHB Research) has maintained its OVERWEIGHT call on the real estate sector, citing the Johor-Singapore Special Economic Zone (JS-SEZ) as a significant driver for long-term growth. The research house highlighted Sime Darby Property, Mah Sing, Sunway, and UEM Sunrise (UEMS) as top picks, given their strategic positioning to capitalise on the anticipated boom in Iskandar Malaysia (IM).
The signing of the JS-SEZ agreement has been described as a confidence booster for the market, reflecting robust bilateral commitments from Malaysia and Singapore. RHB Research noted that this milestone marks a new phase of collaboration, fostering functional policies that will drive investment and development in the region. The infrastructure funding support from Malaysia and facilitation funding from Singapore underscores the dedication of both governments to ensure the SEZ's success.
Iskandar Malaysia is poised for a multi-year growth phase, fuelled by an influx of foreign direct investments (FDIs) and the expansion of industrial and tourism activities. The real estate sector stands to benefit from increased demand for properties, particularly as financial institutions and companies establish offices in Forest City. Improved connectivity is also expected to draw more travellers and workers from Singapore, further driving commercial and residential property demand.
Major landowners such as UEMS, Sunway, and Sime Darby Plantation are positioned to reap substantial benefits. UEMS, in particular, is set to leverage its vast landbank in Gerbang Nusajaya, which includes a 2,334-acre development worth a gross development value of RM45 billion. The research house noted the potential of UEMS to attract logistics, warehousing, renewable energy, and data centre investments, with industrial rezoning in the pipeline. Sunway, too, stands out due to its focus on integrated developments and tourism-driven projects like its theme parks.
The broader implications of the JS-SEZ extend beyond real estate. RHB Research anticipated updates on other major infrastructure projects, including autonomous rail transit, light rail transit, and potentially the revival of the Kuala Lumpur-Singapore high-speed rail. These developments are expected to amplify investor sentiment and further strengthen the economic synergy between Malaysia and Singapore.
