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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 congregate and interact
face to face in one location. Revenue derived from memberships fees and events may be
affected during this period although e-events will continue to progress," he said.
Sarkunan Subramaniam 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
Knight Frank Malaysia
looking to expand to navigate in the near term before committing to a longer-term plan.
Managing director
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.
