Page 7 - Maybank Premier & Priviege Virtual Property Fair eBrochure

EXPERT INSIGHTS

The coronavirus, or Covid-19, has brought the whole world to a standstill, and the
property market is no exception with mounting pressure on the supply and demand.
Knight Frank Malaysia is expecting lower activity in leasing and investment in
commercial office.
The firm's executive director of corporate services Teh Young Khean said the Covid-19
pandemic and Movement Control Order (MCO) has forced companies to limit or halt
physical operations, pushing them to work more flexibly and remotely.
He expects that both local and multinational companies may delay or put on hold their
real estate decisions, resulting in a lower level of leasing activity.
“Business sentiment is at its lowest level, with many operations severely impacted by
the outbreak. The sense of uncertainty will lead to slower demand as businesses and
occupiers will likely continue to postpone major expansion or relocation decisions.
“In the immediate term preceding the lifting of the current MCO, co-working or flexible
space may be less popular as there will be reduced desire for clients or members to
DATO' IR SOAM HENG congregate and interact face to face in one location. Revenue derived from

CHOON memberships fees and events may be affected during this period although e-events will
continue to progress," he said.
President, REDHA Malaysia Nevertheless, Teh said that once confidence has been restored with businesses back to
work, as usual, co-working or flexible space may be a good option for new occupier(s)
and those looking to expand to navigate in the near term before committing to a longer-
term plan.
Retail segment heading downward
In the retail segment, rents will come under further pressure due to the enforcement of
the Movement Control Order (MCO) until 14 April 2020.
The covid-19 pandemic is sending the country's economy reeling. All industries have
been hit and those which have been hit the hardest are hospitality, tourism and aviation-
related segments, evident by cancellations of flights, tour packages and hotel bookings
following international travel restrictions and lock down of countries.
The escalating number of infected cases has led to Malaysia being placed under the
MCO until 14 April 2020.
Knight Frank Malaysia associate director of retail consultancy & leasing, Ben Ooi said
Malaysian retailers, especially those located at tourist zones, have been experiencing
sales decline at their outlets at the onset of the Covid-19 outbreak.
Ooi said after the MCO, occupancy of malls will be under pressure as some retail outlets
may be forced to close due to the strain on their cash flow and unsustainable
businesses.