CB Richard Ellis executive chairman Chris Boyd characterised the Klang Valley’s office market as “an abundance of choice at low prices”, resulting in a flight to quality.
While the office glut has been brought up time and again, a new feature in the sub-segment is the five million sq ft of small offices, home offices (SoHos) entering the market. He said Greater Kuala Lumpur would see office space totalling 100 million sq ft this year with total supply at 95.5 million sq ft as at the second quarter.
This figure excludes office blocks with less than 100,000 sq ft and those less than 10 storeys high. It also excludes Putrajaya and Cyberjaya. A total of 23 million sq ft will be entering the market by 2017, of which a quarter of them will be in the city centre. National Property Information Centre latest figures have it at more than 111 million sq ft.
Boyd said the SoHo market came in different names SoFos (small offices, flexible offices) and SoVos (small offices, versatile offices) and can be used as either offices or residentials.
“They will compete with the upper floors of shop houses which are becoming dinosaurs,” Boyd said.
In the retail scene, Boyd said Malaysia has 50 million sq ft of retail space, which was ahead of Singapore and 18 malls with 10 million sq ft entering the market.
“Second and third generation malls are struggling,” he said, adding that Malaysia had three of the largest malls in the world and 70% of the world’s top brands.
“Our attraction is the number and the variety,” he said, adding that retailers find it “easier to come here” as they need only to negotiate with five major landlords compared with “hundreds” if they aspire to enter London’s High Street market.
