MALAYSIA is fast emerging as a strategic hub for multinational corporations seeking future-proof workspaces, according to a new global report by real estate consultancy Knight Frank.
The firm’s ‘[Y]OUR SPACE 2025’ study reveals that half of global occupiers expect to expand their real estate footprint within the next three to five years—equivalent to an estimated 104 million square feet of new space.
As companies recalibrate their portfolios to withstand economic uncertainty, geopolitical pressures and rapid digital transformation, Malaysia is increasingly seen as a location of choice.
“Knight Frank Malaysia has seen increasing interest from multinationals looking to establish regional headquarters, high-spec industrial hubs, and sustainable logistics solutions in Kuala Lumpur, Johor, and Penang,” the consultancy said in a statement released today.
Particularly strong demand is being observed among firms involved in advanced manufacturing, technology, and regional distribution, reflecting a broader industry trend towards risk mitigation and operational resilience.
Knight Frank Malaysia Group Managing Director Keith Ooi said the country offered a compelling combination of attributes that global occupiers now prioritise.
“Malaysia offers the right mix of cost efficiency, political stability, and market access that global occupiers are looking for today. What truly sets us apart now is the growing quality of our industrial and office spaces — they are being designed with resilience, Environmental, Social and Governance (ESG) readiness, and long-term adaptability in mind,” he said.
The report also indicates a shift in priorities among corporate real estate (CRE) leaders. Enhanced operational efficiency and resilience were cited as top concerns by 38 per cent of respondents—ranking higher than ESG compliance or innovation.
This evolving preference reflects what the report describes as a “flight to functionality”. Companies are increasingly favouring flexible leases, hybrid-ready layouts and location strategies that allow for workforce mobility, risk diversification and improved access to talent.
Further, 63 per cent of respondents said they now prioritise purposeful and adaptable amenities over prestige-driven features such as iconic addresses or elaborate design. This marks a decisive move towards practical, performance-led environments—an area where Malaysia’s new wave of green-certified, wellness-oriented developments are proving competitive.
“With rising expectations placed on CRE teams to enable transformation while navigating constrained conditions, the opportunity for Malaysia lies in delivering experience-led, cost-efficient, and strategically located workspaces that meet both global and local performance benchmarks,” the statement added.
Knight Frank’s findings come amid a wider reassessment of global office and industrial portfolios, as companies seek to align their physical spaces with broader corporate objectives including sustainability, resilience, and digital readiness. Malaysia, bolstered by a maturing real estate sector and investor-friendly fundamentals, appears increasingly well-positioned to benefit from this transformation. - June 5, 2025
