We use cookies to give you the best possible experience on our website. By continuing to browse this site or by choosing to close this message, you give consent for cookies to be used. For more details please read our Cookie Policy.

Why Malaysia’s building and interiors industry?

The 50% fall in the price of crude has hurt a lot of oil exporting countries, but Malaysia is riding it out – its GDP growth forecast for 2015 is likely to exceed previous forecasts of 5.3%.

Why? One reason is that its construction industry is in such a healthy state. The sector grew 8.7% in 2014, driven by private commissioning, low unemployment, massive projects like the KL118 tower, and major state infrastructure programmes.

Here is a snapshot of Malaysia’s building and interiors sector – telling you everything you need to know about his vibrant and growing industry and why it is a great place to do business.

Construction sector facts:

- Malaysia’s building sector grew 8.7% in 2014
- 70% of all construction work in 2014 was commissioned by the private sector, 14% by the government and 16% by state-owned corporations
- 37.3 billion ringgit ($10 billion) of residential construction was carried out in Malaysia in 2014
- The value of construction contracts awarded in Q1 2015 was 250% larger than in Q1 2014
- Sales of paints and coatings in Malaysia in 2012 totalled $9.9 billion
- Per capita ceramics consumption is 3 sqm per year, behind Thailand (4 sqm), giving room for growth

Five major construction projects and development schemes in Malaysia:

1. The KL118 Tower

The KL118 tower is a $1.4 billion skyscraper project that will surpass the Petronas Twin Towers as Malaysia’s tallest building when it opens in 2020. The Malaysian government was not at all involved in the decision to build KL118, which will offer 400,000 sqm of residential, office and hotel space – it is an entirely commercial project commissioned by Permodalan Nasional Berhad (PNB), the country’s biggest fund management company.

In June 2014, the Finnish company Kone won a contract to supply the tower’s 105 elevators and escalators. More key deals for the tower were to be announced by the end of 2014, but this has been extended to the second quarter of 2015, giving potential contractors more time to prepare their bids. The tower’s owners have made it a condition that any foreign bidders form a 60-40 joint venture with a Malaysian company.

2. 1Malaysia Housing Programme (PR1MA)

A programme launched in 2011 to build huge numbers of affordable houses in Malaysia. 120,000 houses have already been approved for construction under the scheme, which is massively over-subscribed – Malaysia’s government have received 950,000 online applications from potential buyers. The houses, 40,000 of which are already being built, will be located in 80 developments around the country and offered to buyers at around 80% of market price. As well as building the houses, the government has also made sure that Malaysians can afford to buy them, by guaranteeing mortgages of up to 110% of the properties’ value.

3. Kwasa Damansara township

The Kwasa Damansara project, which will see an entire town built in the west Malaysian state of Selangor over 15 years, is one of the biggest building projects the country has seen in recent years. It will contain residential, commercial and retail developments, as well as two new stations on Malaysia’s MRT system. In July 2014, builder Malaysia Resources Corp Bhd won a contract to develop 64 acres of the project, which is expected to cater for at least 150,000 people when finished, and Impiana Land and Development has recently signed development rights to put up a further 436 properties in another part of the plot. It is a real fresh opportunity for developers – never previously built on, the 2,330-acre site was sold to the current project owners by the Malaysian Rubber Board for 2.3 billion ringgit ($620 million) in 2012.

4. Economic Transformation Programme

In 2011, the Malaysian government launched the Economic Transformation Programme, which aims to transform Malaysia into a high-income economy by 2020. It identifies 12 National Key Economic Areas that have the potential to contribute to the growth of Malaysia and to transform the Greater Kuala Lumpur / Klang Valley into a top 20 most liveable metropolis globally and a top 20 city in terms of economic growth.

5. Tebrau Bay Waterfront City

The Chinese corporation Greenland Group is spending over $600 million on the Tebrau Bay Waterfront City, a mixed-use development in Malaysia’s southern Johor state that will contain housing, a school, a hospital and even a theme park. Its total area will be 1,000 acres of land along the Tebrau River and the Straits of Johor.

Activity in Malaysia’s build and interiors sector from international companies:

- Cementir and Maccaferri are two big Italian construction sector companies operating in Malaysia

- Vinci Construction Grands Projets, the French corporation, has won and delivered several contracts in Malaysia, winning its latest deal for a 125,000 sqm mixed-use development in Borneo in January 2015

- 15 Italian companies established a regional office in Kuala Lumpur in 2014

- Q Cells, a German producer of solar technology, has been active in Malaysia since 2010

- Nippon Paint, AkzoNobel and Jotun all have a wide presence in Malaysia’s paints and coatings market

- In total, 5,000 foreign companies from over 40 countries have established operations in Malaysia

Country facts:

- GDP: $312 billion (2014)

- GDP growth rate: 6% (2014)

- Unemployment: 3% (2013)

- World Bank Ease of Doing Business ranking: 18th in the world, above Switzerland, France, the Netherlands and South Africa

- Ease of Getting Credit ranking: 23rd in the world

- 2014 World Competitiveness Yearbook ranking – 14th, above the UK, Finland and Australia

- Government type: Constitutional monarchy

- First elections: 1955

- Interest rate: 3.25%

- Population: 30,073,353 (July 2014)

- Foreign Direct Investment (FDI) into Malaysia in 2014: 65 billion ringgit ($17.6 billion)

- Top 5 sources of FDI inflows in 2013: Singapore (18.1% of the total), Japan (14.7%), USA (8.6%), Netherlands (7.9%), Switzerland (4.8%)

- Proportion of economy based on oil exports: – 29.7% (2014), down from 35.4% in 2010

- DHL Global Connectivity Index ranking: 21st out of 140 countries                                         

Sector spotlight: Interior design trends in Malaysia for 2015

The boom in residential construction in Malaysia is good news for suppliers of interior finishes and products. What are the latest trends in the market that exporters should know?

Malaysian interior design will be all about mix and match in 2015, according to Chris Yap, president of the Malaysian Institute of Interior Designers. “There will no longer be one set of furniture in a space,” he told the Malaysian business radio station BFM. Furniture and décor selection will be “a reflection of your personality…mix and match, instead of selecting an entire collection from a magazine.”

Other trends that Yap thinks will be big in 2015 include:

- Gold and metallics. “The use of metallics relates back to history, when gold was a treasured item and reflective of social status, but it can be interpreted now that you would have a wall piece with metallic elements in it – this would be totally relevant today,” said Yap.
- Natural colours. Deep colours such as brown and strong yellows will be used a lot more in 2015, according to Yap – “colours that shout out about a person’s feel of the space, colours that relate back to nature.”
- Wallpaper. A humid climate means wallpaper has struggled for popularity in Malaysia, but Yap thinks that technology has caught up and that wallpaper will make ground in 2015. "Wallpaper allows you to have a good finish without too much fuss, and even the technology of the glues is always evolving. The durability and maintenance properties have also improved - wallpaper can now last quite a few years."

Yap also pointed out some trends that he thinks are on the way out this year in Malaysia. The coordinated look is going - "Have some fun - introduce pieces you've collected during your travels" - as well as the Scandinavian look, which he thinks will filter out in favour of more modern fixtures that make an interior space warmer.

Chris Yap's full interview with BFM is available here

BuildTech Malaysia

The market is waiting – how do you get there? The BuildTech exhibition in Kuala Lumpur can connect you to over 5,000 buyers in Malaysia's building and interiors market. The next edition takes place in October 2015 – visit the show’s website to find out more. 

 

A guide to the building and interiors sector in...Kazakhstan

A guide to the building and interiors sector in...Azerbaijan

A guide to the building and interiors sector in...Indonesia

A guide to the building and interiors sector in...Turkey

A guide to the building and interiors sector in...India

A guide to the building and interiors sector in...Poland

 


Related Events

Event20 Mar

Indobuildtech Ja..

20-24 March, 2019
INDONESIA

JAKARTA, INDONESIA
Venue: INDONESIA CONVENTION EXHIBITION CENTER (ICE)

Get in Touch

Want news like this in your inbox?