A Gateway to Investment Opportunities in Malaysia’s New Southern Nucleus
22 Jan 2024
Malaysia’s southernmost state of Johor, particularly its capital city of Johor Bahru, has emerged as a burgeoning hub of economic activity and investment potential. As part of the Iskandar Malaysia economic corridor, Johor Bahru is strategically positioned to capitalise on its proximity to Singapore, Southeast Asia’s financial and trade powerhouse. This strategic location, coupled with Malaysia’s favourable business environment, has attracted a surge of investments in recent years, transforming Johor Bahru into a dynamic and promising investment destination.
UNVEILING THE POTENTIAL: A Glimpse into the Future
Johor Bahru’s investment potential is underpinned by its diverse and thriving economic sectors. The city is home to a burgeoning manufacturing industry, with multinational corporations such as LEGO, Dyson, and Hershey establishing significant operations. The logistics and warehousing sector is also experiencing rapid growth, driven by the increasing demand for supply chain optimisation and regional trade.
Johor Bahru’s development and growth trajectory is further fuelled by several ongoing and planned infrastructure projects. Such as the Johor-Singapore Rapid Transit System (RTS Link) whose completion in 2026 will significantly enhance connectivity between Johor Bahru and Singapore, facilitating cross-border trade, tourism, and investment.
THE SINGAPORE FACTOR: A Flourishing Tourism Sector and Spillover Effects
Singapore’s tourism industry is also a significant factor in Johor Bahru’s growth. As the city state becomes increasingly crowded and expensive, many tourists are opting to stay in Johor Bahru and visit Singapore for day trips. This trend is expected to continue, further boosting the tourism sector in Johor Bahru which in 2019, Johor Bahru recorded over 30 million tourist arrivals, generating over RM15 billion in revenue. Thus making tourism a key driver of growth.
Moreover, Johor Bahru’s strategic location, just across the causeway from Singapore, presents a significant advantage for investors. The city serves as a gateway to Singapore’s bustling economy, providing access to a vast pool of talent, a strong financial infrastructure, and a well-established business ecosystem. This proximity to Singapore, coupled with Malaysia’s lower costs of living and doing business, creates an attractive proposition for companies seeking to expand their operations in the region.
INVEST IN APARTHOTEL PROPERTIES: A Lucrative Opportunity
Aparthotel properties offer a compelling investment opportunity in Johor Bahru. These properties combine the amenities and services of a hotel with the longer-term stay convenience of an apartment, catering to a diverse range of guests, including business travellers, families, and long-term visitors.
Quayside JBCC, operated by Ascott Group’s Oakwood brand, is a prime example of an Aparthotel property in Johor Bahru. Located in the heart of the city’s historic quarter that is nestled in the vibrant waterfront district, Quayside JBCC offers luxurious accommodations, state-of-the-art amenities, and a range of personalised services. All housed within a mixed development that includes retail spaces, a four star international hotel and the Oakwood Aparthotel.
Investing in Aparthotel properties like Quayside JBCC offers investors several advantages:
Aparthotels are well-positioned to cater to the growing demand for short-term and long-term accommodation in Johor Bahru, driven by the city’s expanding tourism and business sectors.
Diversified Income Stream
Aparthotels generate income from both short-term rentals and longer-term leases, providing investors with a diversified income stream.
Resilient Asset Class
Aparthotels offer a degree of resilience in fluctuating market conditions, as they cater to a wider range of guests covmpared to traditional hotels.
Reputable Aparthotel operators like Ascott Group provide professional management services, ensuring that properties are maintained to the highest standards and that guests receive exceptional service. Thus ensuring a steady and regular income stream.
Aparthotel properties like Quayside JBCC offers investors a lucrative opportunity to participate early in the city’s growth and reap the benefits of its capital growth arising not just from tourism and digital nomads but also from the state’s dynamic and growing manufacturing sector that is bringing an influx of state senior executives and expatriates to Johor.
Source: The Edge Malaysia