Demand for offices outside KL city centre

Demand for offices outside KL city centre

(June 23): Business owners looking for office space in the Klang Valley for their operations will find themselves spoilt for choice in the current slow market, with the wide selection of new office developments that offer various facilities, convenience, competitive rental and perks such as rent-free periods. Beyond Kuala Lumpur city centre, the pull factors for tenants are even more compelling as rents are usually cheaper outside the city centre.

The office decentralisation trend has been ongoing for some time, but lately, new start-ups and some existing business owners are choosing to locate their operations in the city limits rather than in the city centre.

Knight Frank Malaysia corporate services executive director Teh Young Khean has noticed that some companies have been moving out from their KL city centre offices to the fringes of the city.

“The reasons people move away from KL city centre are mainly to avoid the heavy traffic congestion and for easier accessibility between home and workplace. They are also drawn by the cheaper rents,” he tells TheEdgeProperty.com.

According to data from the National Property Information Centre (Napic), both KL and Selangor have seen a rise in supply of office space while occupancy rate has dropped.

Selangor’s office occupancy rate has seen a minute decrease to 75.5% in 2016 from 75.7% in 2015, maintaining at the 75% and above level. KL office occupancy rate, however, saw a more significant drop in 2016 to 77.9% from 81.2% the previous year.

Oregeon Property Consultancy director Kok Chin Yee says there are no significant data to show that business owners are actually moving their operations from KL city centre, but he has observed that the development of office buildings outside KL city centre has picked up in recent times, many with impressive designs and concepts that have drawn the attention of companies including start-ups.

“It’s not only about work anymore, but life after work. Offices in mixed developments with various lifestyle elements, such as shopping malls, F&B outlets, hotels and entertainment, are in demand now,” Kok says.

For instance, mixed developments that allow its occupants to “live, work and play” like Mid Valley City, Bangsar South and Publika in Dutamas are gaining momentum in terms of popularity.

Other similar developments that offer office spaces with easy access to shopping, food and leisure include Bandar Sunway (offices near Sunway Pyramid), Bandar Utama (near 1 Utama Shopping Centre), offices at Mutiara Damansara (near The Curve) and new integrated developments in Bandar Sri Damansara.

Source : TheEdgeProperty