OVERVIEW & PROPERTY MARKET OUTLOOK Malaysia’s economy expanded by 5.2% in 2025, driven by robust domestic demand and favourable export performance, surpassing the earlier forecast range of 4.0% to 4.8%. On 13 February 2026, Bank Negara Malaysia (“BNM”) projected that the Malaysian economy will grow between 4.5% and 5.0% in 2026. This growth momentum is expected to continue, supported by resilient domestic demand and steady export activity. While global uncertainties remain, Malaysia’s diversified economic structure and broad range of policy tools will enhance the nation’s resilience and agility in navigating external headwinds. Investment activity is expected to remain robust, driven by the continued progress of multi-year projects in both the private and public sectors, the implementation of smaller-scale public projects, continued realisation of approved investments, and the rollout of national master plans. Overall, the Malaysian economy is poised to remain stable, anchored by resilient domestic demand and supported by employment and wage growth as well as policy measures that sustain household spending. On the property front, the market is expected to maintain a stable growth trajectory, primarily driven by the prime office, industrial, and tourism-related sectors, as well as ongoing catalytic infrastructure developments. According to the CBRE | WTW Market Outlook Report 2026 titled “Resilience to Relevance”, key drivers include a stronger emphasis on asset quality and adaptability, improved infrastructure and connectivity, as well as rising commitments towards sustainability and efficiency, supported by value-driven components that will shape occupier and investor interest. AR 2025 | MANAGEMENT DISCUSSION & ANALYSIS 42
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