KL-Singapore High-Speed Rail (HSR) Decision by Year-End

Recent news suggests the revival of the HSR project is gaining momentum. Malaysia’s Transport Minister stated that the Malaysian Cabinet will decide on the project by the end of 2024.

Earlier reports indicated that three out of seven consortiums, which had submitted proposals following a Request for Information (RoI), were shortlisted (source: Malay Mail).

The RFI exercise, initially set to close in November 2023, was extended to January 2024 to gauge private sector interest in constructing the HSR via a public-private partnership.

The KL-SG HSR will enhance accessibility and reduce travel time between Kuala Lumpur and Singapore, spurring economic activities and increasing property demand, especially near its station stops. This could shift property demand patterns from urban areas to suburban or rural areas due to the shorter travel time.

High-Speed Rail: Potential Beneficiaries

The presence of an HSR station will enhance the commercial value of surrounding land, catalyzing development potential. However, benefits are expected to accrue over a longer time horizon, particularly near or upon the HSR’s completion. News of the HSR revival will continue to generate interest in listed players with landbank along the track alignment and near the station stops.

Under the previous HSR track alignment, potential beneficiaries included SDPR (at Labu and Pagoh stops), Matrix Concept (MCH MK, CP: MYR1.92, Not Rated, at Labu stop), UEMS (at Gerbang Nusantara stop), and IOI Properties (IOIPG MK, CP: MYR2.11, Not Rated, at Ayeh Keroh stop). The HSR revival could also signal the revival of the Bandar Malaysia project (486 acres at Sungai Besi, KL), the final station stop under the previous rail alignment.

We have also identified plantation estate owners as potential beneficiaries due to the proximity of their estates to some HSR stops, including GENP MK (at Batu Pahat stop), KLK MK (at Gerbang Nusajaya stop), and SDG MK (with large tracts of estate land around Labu and Pagoh stops).