Property

AXIS Real Estate Investment Trust (Axis-REIT) said a Feb 8 fire at a furniture factory in Sea Park, Petaling Jaya has partially damaged Wisma Kemajuan, a property it owns next to the factory.

No injuries were reported.

The REIT said it has adequate fire takaful and fire consequential loss coverage in place.

Wisma Kemajuan contributes about 1.4% of total revenue, and the manager expects the impact on net property income and total asset value to be immaterial.

The consequential loss policy also covers rental income during the repair period. — TMR

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KUANTAN — The Pahang state government has stressed it will not compromise with developers who fail to complete rakyat housing projects according to the required specifications and timeline.

Menteri Besar Datuk Seri Wan Rosdy Wan Ismail (picture) said firm action has been and will continue to be taken against developers facing delays or failing to implement projects as scheduled.

“If delays or problems arise, the Pahang Housing and Real Estate Board (LPHP) will call in the developers concerned to obtain explanations and mitigation plans before the matter is brought to the relevant committee meeting,” he told reporters after officiating at the handover ceremony for PR1MA Pahang Batu 6, Lepar (Phases 1 and 2), and the key handover for PR1MA Pahang Kampung Hijrah, Penor (Phase 3), here today.

Wan Rosdy said developers often cite natural disasters, including floods, as reasons for delays, but the state government will scrutinise follow-up plans to ensure projects are completed.

“We will first hear their problems, including claims of flooding and other factors, but their subsequent plans will be carefully assessed,” he said. 

Meanwhile, State Local Government, Housing, Environment and Green Technology Committee chairman Datuk Mohammad Fakhruddin Mohd Ariff said as of Dec 31 last year, a total of 29,283 housing units had been completed through LPHP, involving development costs of RM2.2 billion.

He said the overall actual development value reached RM4.9 billion, with a return of value (ROV) amounting to RM2.7 billion, covering various state housing schemes, including 9,057 PR1MA Pahang units valued at RM1.4 billion.

“Other schemes include 212 Rumah Makmur units worth RM16.9 million, 13,873 Public Low-Cost Housing (PAKR) units valued at RM485 million, 4,168 Residensi Rakyat Programme (PRR) units worth RM148.8 million, and 1,188 Rumah Rakyat Pahang (RRP) units valued at RM87.2 million,” he said in his speech at the event.

Mohammad Fakhruddin added that other schemes include 384 Rumah Rakyat Al-Sultan Abdullah (Ru’RASA) units valued at RM31.8 million, 121 Flood Victims Housing units worth RM12.2 million, and 280 units under the Warisan Land Scheme (STW), costing RM15 million. — BERNAMA

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by GLORIA HARRY BEATTY

THE government is reviewing the need to continue withholding tax exemptions on Real Estate Investment Trust (REIT) distributions to foreign investors, as Malaysia’s REIT sector has now reached a level of maturity.

Finance Minister II Datuk Seri Amir Hamzah Azizan (picture) said the Malaysian REIT industry has grown steadily since its introduction more than two decades ago.

“Last year, the REIT market cap was about RM57 billion. Before, we started at less than a billion. I think the markets have addressed and accepted that REIT is a viable enhancement to the capital market,” he told reporters at the Forum Ekonomi Malaysia (FEM) 2026 today.

He said it reflects market acceptance and the viability of the sector without continued reliance on fiscal incentives.

On the economic outlook, he said stronger-than-expected performance and healthy order books open the door for an upward revision of growth forecasts when the government reviews the figures in April.

He said the government is focused on implementing initiatives outlined in the 13th Malaysia Plan (13MP) and the 2026 Budget to ensure the economy’s foundations remain strong.

During the “Fiscal & Monetary Policies” panel session, Amir Hamzah said the government will introduce a New Incentive Framework (NIF) starting in the first quarter of 2026 for the manufacturing sector, followed by the services sector in the second quarter, to attract high-value investments and support private sector growth.

He explained that the framework is designed to target high-value, outcome-driven investments, rather than merely rewarding large-scale projects.

“The whole idea of the new incentive framework is to actually be outcome-based. It’s not about quantity, but rather the quality of things coming in,” he said.

Amir Hamzah said the NIF will prioritise investments that generate high-skilled jobs and support labour market reforms. It will also incentivise projects in less-developed areas to encourage more equitable regional development. 

Amir said the NIF will prioritise investments that create high-skilled jobs and promote balanced regional development. 

“The incentive framework will also give some priority in terms of narrowing the gap to encourage much better dispersal of development within the country along the way,” he added.

He said the approach is intended to help Malaysia transition into a high-income economy while promoting balanced, inclusive, and sustainable growth.

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HAILY Group Bhd’s wholly owned subsidiary, Haily Construction Sdn Bhd, has secured a RM48.2 million contract from Gunung Impian Development Sdn Bhd to build 113 double-storey terrace houses at Taman Impian Emas in Johor Bahru.

The project will commence on February 23 2026, with initial works, including a substation, show house and mock-up unit, to be completed within six months, while the main construction is scheduled for completion by October 2027.

The contract is expected to contribute positively to the group’s earnings and net assets over the project duration. — TMR

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PASIR PUTEH — Yayasan Pembangunan Ekonomi Islam Malaysia (YAPEIM) has allocated RM16.44 million to implement 356 house repairs or new house construction projects in the country since 2020 to December last year.

Its director-general, Zabidi Nasan said 260 projects were completed with 96 more in the construction process, and in Kelantan, the foundation conducted 49 projects – 28 new houses and 21 house repairs – with a total allocation of RM2.4 million.

“The aid is not merely to provide comfortable living spaces, but is a symbol of the MADANI Government’s concern in building a loving society and to ensure those in need are not neglected,” he told Bernama during the Sinar Lestari YAPEIM handover here today, where a new house worth RM85,284 was handed to recipient, Siti Rubiah Jusoh, 48, thanks to the cooperation of strategic partner Cagamas Berhad.

Throughout last year, YAPEIM built and restored 80 houses and aimed for a 10 per cent increase this year, he said, adding that from 1985 to November 2025, the foundation has distributed over RM725 million to 10.1 million recipients through various programmes encompassing economic development, education and community action implemented inclusively and holistically.

YAPEIM also manages micro-payment financing through Ar Rahnu YAPEIM with 201 branches to help traders and entrepreneurs secure short-term financing, he said.

“From 2000 to November 2025, Ar Rahnu YAPEIM has benefitted about a million people with financing totaling RM14.2 million and a collateral value of RM28.6 billion,” he added. — BERNAMA

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KUALA LUMPUR — The government has taken three major steps to control house prices in a bid to ensure the people continue to have access to affordable homes.

Deputy Minister of Housing and Local Government Datuk Aiman Athirah Sabu said one of them is capping the ceiling price for affordable homes under the National Affordable Housing Policy at RM300,000.

She added that the ministry has also implemented affordable housing price mapping to ensure the stipulated prices align with the people’s financial capacity.

“The government implemented the affordable housing price mapping based on the state and district median household income from the Household Income and Expenditure Survey 2024.

“This mapping serves as a reference for determining house prices at each locality and can be accessed on the affordable housing information dashboard on the Malaysian Urban Observatory (MUO) website,” she said during the question-and-answer session in the Dewan Rakyat today. 

She was replying to the original question from Muhammad Ismi Mat Taib (PN-Parit) about the steps taken by the government to control the sudden price surge, which is a burden on first-time home buyers.

Aiman Athirah said the ministry has also tightened the monitoring of housing development through the implementation of the Housing Integrated Management System (HIMS), which fully processes housing development licence applications, as well as advertising and sales permits online.

The system, she said, is the main mechanism for collecting housing data for management, monitoring and reporting purposes, as well as for enabling early intervention on projects that are delayed or at risk.

In addition, she said that according to the National Property Information Centre (NAPIC) report, house prices in Malaysia have been rising, with the Malaysian Housing Index for the first half of 2025 recording 227.3 points and an average price of RM490,376 per unit.

At the same time, the government has also strengthened efforts to help first-time home buyers purchase their own homes through the Housing Credit Guarantee Scheme (SJKP), which provides guaranteed financing of up to RM500,000, especially for B40 and M40 groups, including individuals with no fixed income.

She said the SJKP also offers housing loans up to 120 per cent of the property price for first-time home buyers, in addition to providing the step-up financing scheme, which features lower initial monthly instalments that gradually increase as the borrower’s income grows. — BERNAMA

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BINASTRA Corp Bhd continued to build momentum in Johor Bahru after securing another major construction contract valued at RM742.9 million, further cementing its position as a key builder in the southern city.

The contract was awarded to its wholly owned subsidiary, Binastra Builders Sdn Bhd, by Maxim Pelangi Sdn Bhd for the main building works of The Address @ Taman Pelangi, a landmark highrise development.

The project involves the construction of a 72-storey serviced apartment comprising three residential towers with a total of 2,743 units.

The development will feature multi-level podiums with parking facilities, retail components and lifestyle amenities designed to meet the needs of modern urban living.

Construction is scheduled to commence on March 5, with completion targeted within 38 months.

Binastra MD Datuk Jackson Tan Kak Seng said the latest win underscored the group’s execution strength and longstanding client relationships in Johor Bahru.

“We are thrilled to secure another significant project win as we approach the close of the financial year of 2026 (FY26). Being entrusted with nearly RM2 billion worth of projects in Johor Bahru within two weeks reflects the synergistic, longstanding relationships we have built with our clients and reinforces our position as a trusted builder even in Johor Bahru. This represents a strong vote of confidence in our execution capabilities, quality and proven track record,” he said.

Tan added that the project’s strategic location in Taman Pelangi, directly opposite Binastra’s Johor Bahru office, would further enhance the city’s skyline and contribute meaningfully to its evolving urban landscape.

“Strategically located in Taman Pelangi, directly opposite our Johor Bahru office, this development will further enhance the city’s skyline and contribute meaningfully to its evolving urban landscape.

“The project benefits from a mature and well-connected township, with close proximity to key commercial, residential and recreational hubs, making it highly attractive to both homeowners and investors,” he said.

The RM742.9 million contract follows a string of recent project wins in Johor Bahru.

Last Friday, Binastra Builders secured two main building and infrastructure works contracts worth a combined RM1.2 billion from Exsim Lumba Kuda Sdn Bhd for the Causewayz Square development.

The contracts involve a multiphase 63-storey serviced apartment project comprising 4,525 units. Package 2A covers Phases 1 to 3, including a 14-storey podium, Tower A with 908 units across 49 storeys and Tower B with 1,257 units across 46 storeys. Package 2B covers Phases 4 and 5, comprising Tower C with 833 units and Tower D with 1,527 units, both rising 46 storeys, with integrated parking, retail and recreational facilities.

The latest contract is expected to contribute positively to the group’s earnings over the next three years.

To date, Binastra has secured RM4.2 billion in new contract wins for FY26, surpassing its full-year target and lifting its total outstanding orderbook to a record RM6.6 billion.

TA Securities Holdings Bhd maintained its ‘Buy’ call on Binastra with an unchanged target price (TP) of RM2.85, based on 17 times CY26 earnings per share. — TMR

• This article first appeared in The Malaysian Reserve weekly print edition

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Built to anchor Malaysia’s push to become a credible international financial centre, TRX is now recording sustained tenant demand, rising capital commitments and growing international visibility

by AKMAR ANNUAR

KUALA Lumpur’s (KL) long-held ambition to stand alongside Asia’s recognised financial centres is beginning to find physical and institutional form at Tun Razak Exchange (TRX), as the district enters a phase defined less by aspiration and more by market validation.

Built to anchor Malaysia’s push to become a credible international financial centre (IFC), TRX is now recording sustained tenant demand, rising capital commitments and growing international visibility, placing it at the heart of the country’s financial competitiveness narrative.

TRX City Sdn Bhd CEO Datuk Azmar Talib (picture) said the district’s progress is being measured not only through occupancy and investment figures, but also through the structural shifts it is catalysing across Malaysia’s financial ecosystem.

“We measure TRX’s success on two fronts: Tangible market performance and the structural strategic shifts it is driving across Malaysia’s financial ecosystem,” he said in an email interview with The Malaysian Reserve (TMR).

TRX City, the master developer of the 70-acre (28.33ha) TRX, is wholly owned by the Ministry of Finance (MOF).

The Exchange TRX mall has evolved into a retail destination, supported by international luxury brands, regional lifestyle concepts and flagship dining and entertainment operator (Source: Media Mulia)

Market Response

On the ground, the market response has been decisive, with the district now recording more than 80% occupancy based on net lettable area, while its landmark tower, Exchange 106, houses about 90% international tenants. They include global banks, institutional investors, centres of excellence and multinational firms, who have chosen TRX as their regional headquarters.

That confidence is increasingly visible beyond the precinct itself, with KL climbing to 45th place in the Global Financial Centres Index (GFCI), a ranking published by a London-based think tank and a Shenzhen, China, based institute. The nation’s financial technolog y (fintech) competitiveness ranking improved to 51st from 54th.

“We are now seeing stronger interest from fund managers, insurance providers, fintech players and digital financial services companies that previously had limited operational presence in Malaysia,” said Azmar.

Looking at the bigger picture, he said TRX’s progress aligns closely with national policy priorities under the 13th Malaysia Plan (MP13) and Budget 2026, both of which place renewed emphasis on high-value investment, financial services growth and talent mobility.

The challenge it to deepen the presence of global asset managers, attract more cross-border fintech and digital finance firms, enhance regulatory harmonisation for international products and sustain reforms that improve Malaysia’s overall business competitiveness.

While acknowledging these gaps, he argued that KL already has strong fundamentals, including connectivity, talent availability and rising interest from firms seeking regional treasury and operational hubs.

“TRX will continue to be the nucleus in driving these shifts, and consistent policy support will accelerate our trajectory,” he said.

Capital, Scale and Confidence

From an investment standpoint, TRX’s scale reflects the ambition behind the project.

The district carries a gross development value (GDV) of about RM40 billion across office, retail, residential and hospitality assets, underpinned by a balanced mix of domestic and foreign capital. To date, TRX has attracted more than RM8 billion in investments and hosts over 20,000 professionals, a figure expected to double to 40,000 upon full development.

“This concentration of highvalue activities is a strong indicator of the district’s maturity and global pull,” he said.

Foreign participation remains particularly strong in the office and retail segments. Azmar said this diversified capital structure has strengthened TRX’s long-term resilience and risk profile, supporting positive return expectations as the district continues to mature.

“Our projected returns remain positive based on strong indicators: Rising footfall at The Exchange TRX, increasing demand from multinational financial tenants and capital appreciation across completed parcels,” he said.

TRX meets the highest ESG and international green certification (Bloomberg)

Reframing Value in a Post-pandemic Market

Securing major tenants in the post-pandemic environment required a shift in strateg y, as corporations reassessed their real estate footprints and raised expectations around stability, talent access and digital resilience.

“The environment was cautious, and expansion decisions were slower across the board,” Azmar said.

TRX’s response was to reposition itself not merely as a real estate development, but as Malaysia’s IFC — a platform designed for regional scaling, regulatory proximity and ecosystem effects.

“We shifted the conversation away from space and into value,” he added, noting that TRX met the highest environmental, social and governance (ESG) and international green certification standards.

Operational advantages such as resilient digital infrastructure, integrated mobility and long-term cost efficiencies were also emphasised, but Azmar said the true competitive edge lay in the ecosystem itself.

“Global players wanted to be near regulators, professional services, fintech innovators and their financial peers,” he said.

TRX also adopted a more con-sultative engagement model, co-creating solutions with potential tenants through future-proofed cyber security features, hybrid-ready environments and phased growth pathways.

“That level of responsiveness provided certainty at a time when global decision-making cycles were volatile,” he said.

Tenancy Mix and Ecosystem Curation

Today, TRX’s tenant mix reflects its deliberate ecosystem-building approach. The district is anchored by international and regional financial institutions including HSBC, Singapore-based leader in digital payments and fintech provider Ant International, insurer Prudential, Japanese financial institution Mitsubishi UFJ Financial Group Inc (MUFG), KAF Group of Cos, Principal Asset Management Bhd and Bin Zayed International (BZI), alongside professinal services firms such as PwC Malaysia.

The Exchange TRX mall has evolved into a retail destination in its own right, supported by international luxury brands, regional lifestyle concepts and flagship dining and entertainment operators.

Looking ahead, Azmar said TRX is targeting partners who reinforce its long-term positioning as Malaysia’s IFC, including global financial institutions, international asset managers, fintech and technology firms, luxury hospitality operators and premium mixed-use developers.

Educational anchors such as Monash University Malaysia are also strategically important, he said, as they integrate talent development, research and industry linkages directly into the district.

“The goal is deliberate: To curate an ecosystem that combines financial depth, innovation, talent and lifestyle,” he said.

Local vs Foreign Demand

Demand from local and foreign tenants remains balanced, though driven by different strategic motivations.

Local institutions view TRX as a natural base to consolidate operations and modernise facilities, while foreign tenants are drawn by world-class infrastructure, regulatory readiness and cost advantages relative to other regional hubs.

“What we are seeing now is a shift from short-term interest to long-term commitment,” Azmar said.

He said TRX has strengthened KL’s brand equity as a financial hub, with firms increasingly planning multi-year expansion strategies anchored in Malaysia’s talent strength and competitive business environment.

Legacy Issues and Governance

Addressing concerns linked to TRX’s early association with 1Malaysia Development Bhd (1MDB), Azmar said the district has been built on a foundation of integrity, strong governance and institutionalised processes from the outset.

“The strongest validation comes from the market itself,” he said, pointing to growing participation from global banks, institutional investors and multinational corporations.

The state-owned 1MDB was at the centre of a massive global corruption scandal involving alleged embezzlement, money laundering and theft of billions of dollars by top officials, including then-Prime Minister (PM) Datuk Seri Mohd Najib Razak.

Tall buildings signal ambition, but they do not compensate for rigid or inconsistent policymaking, says Adli (Pic courtesy of Adli Amirullah)

What Economists Say

While TRX’s physical scale and commercial momentum have strengthened KL’s financial credentials, economists caution that infrastructure alone cannot define investor confidence or elevate a city into the top tier of global financial centres.

Public policy start-up Wawasanex co-founder and chief economist Adli Amirullah said by concentrating financial institutions, professional services and support infrastructure within a single district, TRX reduces friction in how firms interact, collaborate and scale — an important structural improvement for a market that has historically been spread across multiple locations.

“An IFC-style development can help cluster institutions, talent and capital, which does matter, especially in a fragmented system,” he told TMR. 

However, Adli cautioned that investor confidence is ultimately anchored less in physical infrastructure and more in whether policy outcomes are predictable over time, particularly in an era where finance and technolog y are increasingly intertwined.

He said this challenge becomes more pronounced as digital finance, fintech and platform-based models expand, requiring regulators to strike a careful balance between innovation and oversight without introducing uncertainty that deters long-term capital.

“To put it bluntly, tall buildings signal ambition, but they do not compensate for rigid or inconsistent policymaking,” he said.

He added that long-term investors assess markets based on their ability to anticipate how policies will evolve, how regulations will be applied in practice and how institutions respond during periods of financial stress.

From a market perspective, however, property consultants point to TRX’s leasing performance as evidence that occupiers are already voting with their balance sheets.

A Knight Frank Malaysia’s report noted that TRX’s occupancy rate was expected to close at around 78% by end-2025, broadly comparable to the 72% occupancy level of Grade A offices in KL city overall.

Within the precinct, Exchange 106 has achieved committed occupancy of about 75%, reflecting sustained demand for premium-grade, well-located assets despite a cautious global office market.

Teh believes that TRX’s positioning as an international-level financial district enhances its competitiveness (Pic courtesy of Knight Frank)

“This performance indicates that flight-to-quality remains a major driver of tenant decision-making heading into 2026,” said its senior ED for office strategy and solutions Teh Young Khean.

He added that TRX’s positioning as an international-level financial district, supported by marquee incentives for financial institutions and regulated industries, enhances its competitiveness.

TRX now accounts for roughly 20% of KL’s Prime A and Grade A office stock yet has contributed almost half of annual market absorption since 2021 — underscoring its role as one of the city’s most active demand drivers.

For economists, the contrast between these perspectives is instructive. TRX’s success in

attracting tenants and capital suggests that KL’s fundamentals — talent availability, cost competitiveness and institutional depth — are increasingly compelling.

At the same time, sustaining that momentum will depend on whether policy clarity, regulatory agility and institutional credibility evolve in step with the physical ecosystem now taking shape.

In that sense, TRX may not be the endpoint of Malaysia’s financial ambition, but rather a stress test of whether the countr y’s broader policy environment can keep pace with the scale of its aspirations.

Anchoring the Next Decade

Moving forward, Azmar said the next phase of TRX’s development will focus on deepening its role as the nucleus of Malaysia’s financial centre by activating a richer ecosystem of institutions, talent and innovation.

“We see TRX as a neutral, highly connected hub at the heart of ASEAN,” he said.

He said this direction aligns with national priorities under MP13, where finance is recognised as a high-value, high-growth sector alongside digital and high-tech industries.

“Ultimately, our ambition is clear: TRX will be a strategic engine of Malaysia’s financial competitiveness,” Azmar concluded.

• This article first appeared in The Malaysian Reserve weekly print edition

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Helping the construction boom are new reforms that are expected to take off in January to allow overseas buyers to own property in Saudi Arabia’s real estate market 

by ZAINAB FATTAH 

AFTER driving for nearly an hour north of Riyadh, the sand dunes start to give way to an emerging metropolis with thousands of newly-built single-family homes stretching over the horizon. They could be part of any American suburb. 

Khuzam, as this more than 100 billion riyal (RM108.34 billion) project is called, offers a window into Saudi Arabia’s efforts to beat the affordability problem plaguing housing markets from New York to Sydney. It’s also part of Crown Prince Mohammed bin Salman’s (MBS) broader efforts to reshape the real estate market while attracting foreign investors and buyers to bolster the economy. 

The nation’s largest developer, the government-backed National Housing Co (NHC), which has projects worth 250 billion riyals across the kingdom, is spending billions on sprawling developments like this one while private firms across the nation are joining the race to build. The market has lured even the Trump Organisation, the US president’s family property firm, which is working with a Saudi partner to add luxury apartments in the kingdom. 

Helping the construction boom are new reforms that are expected to take off in Janu- ary to allow overseas buyers to own property in Saudi Arabia’s real estate market. They dovetail with other reforms. The kingdom last week opened its equities to all foreign investors, the latest step to boost flows into the Middle East’s largest market. 

It’s a long-anticipated step that developers are hoping will draw buyers and international investors to a market that remained largely off limits to foreigners for decades. The kingdom has been easing certain restrictions for some resident expats in stages and it’s now looking to designate developments and zones where foreigners are allowed to buy. Yet, even as the nation draws more money from overseas it will have to ensure sufficient supply of new homes to make sure that local Saudis aren’t priced out. 

The new law will “be a real game changer for the market,” said Matthew Green, head of Middle East and North Africa research at real estate firm CBRE Group Inc. “There is a massive amount of capital that wants to be there and you’ll start to see those opportunities open up both on the development and the financing side.” 

The pool of a newly built residence. Many young Saudis are forgoing the costly housing of their parentsʻ generation in favour of apartments and shared community amenities

The excitement in the property market is palpable. A similar law in Dubai has helped drive both supply and demand for new homes and lured buyers from India to the UK and Russia. Saudi developers are launching marketing campaigns for their projects overseas and building networks with brokers across the world. 

Still, many wealthy foreigners have snapped up second homes in Dubai partly because it’s seen as a fun vacation destination. Social mores remain conservative in Saudi Arabia. Although the kingdom is adding resorts, Riyadh still doesn’t offer the lifestyle perks of many other international cities even as some restrictions on alcohol sales have been loosened in recent weeks. 

However, some investors see the Saudi housing market as a more stable bet than nearby Dubai, where the population is mostly made up of expats, some of whom have left during previous downturns after losing their jobs. By contrast, Saudi Arabia’s population of about 35 million — the Gulf’s largest with nearly 20 million citizens — provides a solid case for future demand. About 34% of Saudis are below 14 years old, according to government data, which is likely to boost demand for homes in the coming years. 

“Housing is central to the crown prince’s vision because it’s tied to a number of domestic dynamics,’’ said Sanam Vakil, director of the Middle East and North Africa Program at Chatham House. “Legitimacy internally is so important and he is not yet king. He has to deliver transactional and transformational policies to take this younger generation on the journey with him.’’ 

The law is also expected to breath new life into many Saudi projects that the government started but may struggle to finance on its own like Diriyah and Qiddiya, which are near population centres and will likely see quick return on the investments. Foreign developers, suppliers and contractors will be able to enter the market through joint ventures (JVs) with local firms on a more even footing as the law comes into practice, experts said. Meanwhile, more than 600,000 homes are expected to be built in Saudi Arabia by 2030 including 110,942 to be delivered in 2026 alone, according to Knight Frank. 

But there are also challenges, especially to the government’s affordability agenda. Apartment prices in Riyadh surged 96% from early 2019 to third quarter of 2025 (3Q25), while villas prices surged 53%. Thou- sands of Saudis have migrated to Riyadh in search of job opportunities. Meanwhile, the expats who arrived as the government pushed companies to relocate their regional headquarters to the kingdom have contrib- uted to the surge in rents, which have been climbing an average of 8.5% a year, according to CBRE. The crown prince has ordered a freeze on rent increases in Riyadh for five years and vowed to halt an “unacceptable” rise in property prices. 

To ensure that prices don’t keep taking off, modern new homes will need to be built quickly. 

Key to those efforts are firms like NHC, where CEO Mohammed Albuty has been tasked with helping lift homeownership rates to 70% by 2030. That means building hundreds of thousands of new homes across the kingdom. 

So far, the developer has managed to build only about 60,000 of those, but Albuty says delivery of entire communities will pick up sharply in coming years as much of the groundwork needed to ease bottlenecks and address logistical and supply issues has been done.

In his quest to create a development machine, Albuty has turned to many foreign firms. NHC has inked agreements with developers from New Jersey to Egypt and construction firms from China to South Korea thought JVs. The goal is bringing construction capacity while creating badly needed supply chains closer to home. 

The firm has over 164,000 homes under construction from Jeddah on the kingdom’s west coast and Dammam on the East Coast, as well as in the holy cities of Mecca and Madinah. 

“We’re not building housing or boxes in the middle of a desert,” Albuty said. “We’re building a city within a city. It has all services and all amenities near by.” 

The firm had record sales in 2024, hitting 27 billion riyals, the CEO said. He estimated that sales in 2025 exceeded 30 billion riyals with more people moving into the growing communities. 

Out are the bare towers that were a hallmark of Gulf construction in the 1970s and in come American-inspired housing subdivisions that include offices, shops, entertainment, hotels, parks, gyms, clinics, schools and nurseries to reduce commuting time and provide a better quality of life. 

The dining room of a show flat in the Khuzam development

On a recent afternoon at one of Khuzam’s newly occupied neighbourhoods, women clad in black abayas sipped tea from paper cups while children played in a green park just a few hundred metres from their home in the newly-completed community. 

The change would have been unthinkable years ago when most Saudis preferred their own home gardens surrounded by high walls that protected families from prying eyes. But as the cost of living bites, many young Saudis are forgoing the costly housing of their parents’ generation in favor of apartments, townhouses and shared community amenities. 

Elsewhere, Abdulrahman Aldhyem, the CEO of privately-owned Liwan Real Estate Development is planning a new 4.5 billion riyal development with 2,500 homes in the capital along with a 300-room hotel. Liwan, which is owned by members of several prominent Saudi families, has previously made bets in Turkey and Dubai — surviving a sharp downturn in the emirate after the 2008 financial crisis. 

But now, with the kingdom on the cusp of allowing foreigners to buy in Saudi Arabia, Aldhyem sees the future in his home market and he can’t hide his excitement. 

“For a while we were being approched by Saudi institutions looking to buy entire buildings for recurring income,’’ Aldhyem said. “But now, that’s changing and we’re seeing regional investors from the Gulf as well as a Chinese fund that’s looking to buy in our project.’’ 

Large institutional investors are also likely to come into Saudi Arabia much faster than in Dubai because they are now more familiar with the region’s markets, Green said. 

“We’re going to see more investment, more developers, more JVs and more partnerships come out’’ of the new rules, he said about Saudi Arabia. — Bloomberg

• This article first appeared in The Malaysian Reserve weekly print edition

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KIP Real Estate Investment Trust (KIP REIT) saw its net profit for the first half ended Dec 31, 2025 (1H26) surge 57.6% to RM34.76 million from RM22.06 million a year ago, bolstered by a period of transformative growth and the integration of strategic asset acquisitions.

The group’s top line for the six-month period rose 48.6% year-on-year to RM84.24 million, while net property income (NPI) increased 50.5% to RM62.1 million.

The strong performance was supported by higher occupancy rates and effective cost management, alongside an increasing contribution from the group’s burgeoning industrial portfolio.

KIP REIT has proposed a third income distribution of 1.7 sen per unit for the second quarter, payable on March 3, 2026.

This brings the total year-to-date distribution to 3.5 sen per unit.

For the second quarter (Q226) alone, KIP REIT’s net profit rose 46.2% to RM17.52 million, while gross revenue climbed 44.9% to RM43.47 million.

The growth was spearheaded by the retail segment in the central region, which saw revenue skyrocket 110.7% to RM21.3 million.

A primary driver for this segment was the performance of DPulze Shopping Centre in Cyberjaya, which delivered RM7.1 million during the quarter, representing approximately 50.9% of the NPI for the central region.

The group also benefited from the successful acquisition of KIPMall Desa Coalfields.

Its CEO Valerie Ong attributed the results to a focus on high-yield, community-centric assets.

“Our retail assets, especially in the central region, continue to serve as the backbone of our portfolio, providing stable and growing income streams. With the upcoming festive seasons of Thaipusam, Chinese New Year and Hari Raya ahead, together with the rollout of the SARA scheme in February, we expect higher footfall across our malls,” Ong said in a statement.

She noted that the SARA scheme specifically benefits essential spending categories like fresh markets and value retailers, which are core to KIP’s tenant mix.

Looking ahead, the group is focused on maintaining momentum through active asset management and asset enhancement initiatives (AEI).

The grand reopening of the transformed KIPMall Tampoi is scheduled for Feb 8, 2026.

“With the installation of a new footfall system, enhanced functionality and improved tenant ecosystem, we are creating a more welcoming environment for our shoppers. Supported by this robust pipeline and a strengthened capital base, we remain well-positioned to deliver sustainable value,” Ong added. — TMR

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