Malaysia’s super-rich
Spring brings seasonal changes, the Commonwealth Games and the latest issue of The Wealth Report - data examining the levels of affluence of private buyers’ and interest in commercial real estate.
The report, by global property consultancy Frank Knight, looks at wealthy investors’ buying habits of property assets across the world's big cities. This year’s report reveals that Asia is a real force to be reckoned with, showing a 15% rise in Asia’s ultra-wealthy set, which has taken the total population to 35,880. It’s predicted that there’ll also be strong growth in various countries across Asia with Malaysia – a Commonwealth country - named as one of the contenders. It has an estimated growth of (+65%) and its expansion also stretches overseas, as the report reveals that approximately 43% of Malaysia’s super-rich aim to invest in properties abroad in the next few years. Countries of interest for property purchase are the UK, Australia and Singapore. In terms of investment in the UK, property experts’ site one of the contributing factors being the depreciation of sterling, along with price falls since the EU referendum vote was announced.
Economy
Over the decades the Malaysian economy has been busy growing from strength to strength. Part of the successful transition has been due to a change in its Government policies to become more outward looking by encouraging trade and foreign direct investment. To this end, the country has signed twenty one trade agreements.
The international legal firm, DAC Beachcroft, recognises the rise of Malaysian wealth and its craving for investment. In its paper, DAC Beachcroft sites the UK as an attractive investment destination for Malaysia with both countries sharing similar business and legal cultures and a growth in its trading and investment relations.
Student market potential
As a Commonwealth member since 1957, Malaysia and the UK have formed a relationship underpinned by two-way trade and investment, education links, collaborations in scientific research, defence and security. Its ties with the UK are deep and its investment in the UK is not new. Malaysia’s most high profile UK property investment is the regeneration of London’s iconic Battersea Power Station. This includes developing an international business quarter, cultural facilities, retail, restaurants and residential units.
Along with its commercial property ideas, a serious area of interest for Malaysian super-rich property investment hunters is purpose-built student accommodation (PBSA). Given that approximately 17,000 students originating from Malaysia have passed through the UK’s higher education institutions, this makes perfect sense. These numbers make Malaysians the fourth highest non-EU group to study in the UK.
This, along with data from GOV.UK, which shows how five British universities have set up campuses in Malaysia - the first being University of Nottingham which set up out there in the year 2000. Add this, dozens of British International Schools throughout Malaysia – there is evidence of a real appetite for a Malaysian, UK, student and education mix. Therefore it’s easy to understand why purpose-built student accommodation is on the list of priorities.
RWinvest insist that PBSA is becoming a popular choice - particularly for overseas students - we can expect to see more of these properties/construction projects funded by Malaysian wealth in the future, with a likely presence across our big cities such as London, Manchester and Liverpool.