Business

Knight Frank Global Cities 2018: CentreKL has three key strengths to propel it to top regional tech district status

KUALA LUMPUR: Affordability, good connectivity and well-designed mixed-use developments will be Kuala Lumpur’s trump cards as it strives to become one of the leading technology districts in the region.

InvestKL CEO Datuk Zainal Amanshah said Kuala Lumpur has continued to attract multinational digital technology companies because of the ease of doing business, infrastructure development which improved connectivity within the city, and the enhancement of overall liveability.

“We are also embracing [the] digital economy by positioning ourselves [well] as a city of high technology and successfully attracting MNCs to set up their regional offices in Greater Kuala Lumpur. These include the Digital Free Trade Zone launched by the Malaysian government and Alibaba Group, Oracle digital hub in Mid Valley, and Honeywell Asean headquarter at Bangsar South,” he said.

Besides improved connectivity within the city following further public transportation development, Zainal added that the increasing airline routes to other major cities from Malaysia also enhanced global connectivity. He noted that the digital economy has contributed 17% to Malaysia’s gross domestic product (GDP) and the government has plans to increase the contribution of this sector to 20% to 21% by 2020.

Digital economy activities include cloud computing, big data, data centre, fintech, gaming, Internet-of-Things and e-commerce.

Zainal was speaking to reporters after the “Global Cities: The 2018 Report” launch.

The annual report is conducted by global property consultancy firm Knight Frank, which looks into the continuous trends in real estate across 40 global cities, providing insights for investors in making future investment decisions.

Knight Frank Malaysia managing director Sarkunan Subramaniam concurred that Greater KL is one of the key market leaders in mixed-use developments. These self-contained developments, which promote the “live, work, play” factor, integrate the retail, office and residential components and are well-supported by good transportation infrastructure such as mass rapid transit, light rail transit and bus rapid transit. He noted that successful mixed-use developments include Mid Valley City, Bangsar South and Sunway Resort City.

Damansara City, which is seeing the rejuvenation of its former town centre into Pavillion Damansara Heights, will be the new address to watch.

According to the Global Cities Report, Shoreditch in London and Mid-Market in San Francisco are the world’s most expensive tech districts, with annual rental of US$90.75 (RM383.16) psf and US77 psf, respectively.

In the Southeast Asia market, CBD in Bangkok and Zhongguancun in Beijing are the most expensive tech districts in the region, with per annum rental of US$74.25 psf and US$55.05 psf, respectively. In Malaysia, the pioneer global tech hub, Cyberjaya, has offered some of the most competitive rents compared with the rest of the global cities. Ranked 28th, Cyberjaya’s office market has recorded per annum rental of US$11.55 psf.

However, Sarkunan emphasised that tech districts in Kuala Lumpur is not only limited to Cyberjaya, in fact, KL Sentral, Mid Valley City and Bangsar South have also becoming popular destinations for MNCs setting up offices in Kuala Lumpur.

​Source: The Edge Malaysia