Penang’s property market remained relatively resilient in the first half of 2026, although market activity was more measured as buyers and investors became increasingly selective. According to Knight Frank Malaysia’s Real Estate Highlights 1H2026, the state’s established manufacturing base, continued investment, infrastructure development and tourism activity provided support to the property sector, while affordability, location and product quality remained important considerations.

The residential market was softer in 1Q2026, with transaction volume declining 16.6% year-on-year (y-o-y) to 3,443 units, while transaction value fell 13.2% to RM1.6 billion. Demand remained concentrated in the affordable and mid-priced segments, particularly properties priced between RM200,000 and RM400,000. Despite the lower transaction activity, residential values remained resilient. The Penang High-Rise Residential Price Index rose 3.4% y-o-y to 229.9 points.

High-rise residential supply also continued to expand, reaching 138,330 existing units in 1Q2026, up 6.9% y-o-y. Nevertheless, developers remained active, with approximately 1,998 residential units launched in 1H2026. Serviced apartments accounted for most of the new launches, alongside premium, low-density condominiums. Notable launches included AVEA in Andaman Island, The Fount in Batu Uban, Keeperz Suites and Merione Residences in The Light City, with gross selling prices ranging from about RM840 to RM1,857 per sq ft among these projects.

The industrial sector continued to stand out as a key growth driver. Penang recorded RM4.9 billion in approved manufacturing investments in 1Q2026, including RM3.4 billion in foreign direct investment. Industrial transaction volume and value also increased by 19% and 67.8% y-o-y respectively, reflecting continued demand for higher-value industrial assets. Major investment announcements during the period included Nexperia’s RM1.6 billion semiconductor investment, WaferWise Semiconductor’s RM700 million investment and Boston Scientific’s RM308 million project in Batu Kawan.

Penang’s office market expanded modestly following the completion of The Light Exchange in Gelugor, which added about 176,000 sq ft of net lettable area. Total privately owned office stock increased to approximately 8.2 million sq ft, comprising 6.7 million sq ft on Penang Island and 1.5 million sq ft in Seberang Perai. Occupancy continued to strengthen, supported by demand from global business services, technology and corporate occupiers.

The retail market remained relatively stable, with cumulative supply at approximately 21.1 million sq ft and an overall occupancy rate of 70.5%. The upcoming 1 million sq ft The Waterfront Shoppes is expected to introduce additional competition while benefiting from tourism and MICE-related activity.

Meanwhile, Penang’s hospitality sector continued to strengthen, supported by tourism activity, improving air connectivity and a growing MICE sector. The state has an active pipeline of 18 hotels, while recent openings have expanded its offerings across luxury, heritage and lifestyle segments. However, increasing hotel supply has also resulted in greater competition, particularly in the four-star segment.

Looking ahead, Knight Frank expects Penang’s high-rise residential market to remain relatively stable, supported by the state’s economic base, urbanisation and demand for well-connected locations. Major infrastructure initiatives, particularly the Mutiara LRT Line and Penang Silicon Island, are expected to enhance connectivity and support selected residential locations. At the same time, buyers are likely to remain cautious and place greater emphasis on affordability, practicality, connectivity and long-term value.

About Mandarin Residence

Affordable housing project by Focal Products Sdn. Bhd. in Farlim, at the junction of Jalan Teochew Satu and Jalan Thean Teik. It is right next to Hui Aun Apartment and just 1km from Sunshine Central. The development features a total of 646 residential units with 11 levels of car parking podium. With direct access to Thean Teik Highway, residents enjoy excellent connectivity and nearby conveniences.

Find out more about Mandarin Residence

Source: Final Draf RSNPP2040

A proposed “Penang Gateway” development along Penang Island’s northern coastline has emerged as one of the potential future development concepts identified in the draft Penang Structure Plan 2040.

The proposed concept involves reclamation and mixed development extending from Tanjung Bungah to Batu Ferringhi, with potential uses including tourism, services, trade and property development. Chief Minister Chow Kon Yeow confirmed that the state government has received a proposal related to the area, but stressed that it remains only a proposal at this stage.

Speaking after the “R.A.C.E To Zero: Penang Edition” clean energy summit on Thursday, Chow said the area needs to be incorporated into the structure plan first so that any future development proposal would not face planning constraints should it eventually proceed. He also emphasised that the structure plan is intended to provide a framework for possible future development, and not every proposal included in the plan will necessarily be implemented.

According to reports, the draft does not currently specify the proposed reclamation area, development cost, developer or construction timeline for Penang Gateway.

The concept also revives an earlier proposal involving the northern coast. In 2019, the state government confirmed that it had received a private proposal to reclaim about 121 hectares of sea off Batu Ferringhi for a mixed development comprising hotels, commercial components and serviced apartments. At the time, Chow said the proposal remained subject to further assessment and approvals.

The latest proposal should therefore not be regarded as an approved reclamation project. Its inclusion in the draft Penang Structure Plan 2040 indicates that the state is considering the area within its longer-term spatial planning framework, while the actual scale, design, environmental impact and feasibility of any development would depend on subsequent studies and approvals.

Penang already has several major reclamation initiatives forming part of its longer-term development planning, including the Silicon Island Development and various waterfront projects. The proposed Penang Gateway would represent a significant new addition to the island’s northern development corridor if eventually pursued.

Andabreeze Residences, a serviced residence development by Pixel Valley Sdn Bhd, a member of Kerjaya Prospek Group in Batu Kawan. Located on a 4.86-acre land at the intersection of Persiaran Cassia Barat 3 and Persiaran Cassia Barat 5, adjacent to Columbia Asia Hospital and Vertu Resort Condominium. It is only a few minutes walking distance to Central Island Park and UOW Malaysia KDU Penang University College.

The project comprises two residential blocks, Blok A and Blok B, offering a total of 1,406 residential units. Blok A is a 54-storey building with 744 units, while Blok B is a 47-storey building with 662 units, each featuring a recreational area on its top floor.

The 9th floor is dedicated to shared facilities and recreation, including management office, swimming pool, hall, gym, and other amenities for both blocks. An 8-level car parking podium is provided for residents.

Property Name: Andabreeze Residence
Location : Bandar Cassia, Batu Kawan
Property Type : Serviced residence
Total Units : 1,406
Built-up Size: 624 sq.ft. – 1,281 sq.ft.
Land Tenure : Freehold
Indicative Price : RM518,000 onwards
Developer : Pixel Valley Sdn Bhd

DISCLAIMER: This article is solely based on research done using publicly available data. This is not an advertisement. Any claim, statistic, quote or other representation about a project or service should be verified with the developer, provider or party in question.

Source: The China Press

Plans for a new bridge linking Penang Island to Pulau Jerejak are taking shape, with the proposed 1km crossing envisioned as a distinctive landmark rather than a conventional road bridge.

Bayan Baru MP Sim Tze Tzin said the bridge is planned with four lanes, comprising two lanes towards Pulau Jerejak and two lanes towards Penang Island, together with pedestrian and cycling paths. Road widening works leading to the proposed bridge are expected to begin next month, but the bridge itself has yet to start construction as its final design is still being refined.

Sim said he had proposed that the developer give the bridge its own identity, noting that Penang already has the First and Second Penang Bridges. The developer has accepted the suggestion and plans to engage two international architects and one local architect to work on the design. No final visual rendering is available yet.

The bridge is expected to take about three years to complete, with a target completion date of March 2029. Once completed, it would provide direct road access to Pulau Jerejak, which currently remains accessible only by boat, potentially improving connectivity and attracting more visitors.

The bridge is part of a proposed development covering about 80 acres on Pulau Jerejak. The plans include a financial centre, resort facilities, serviced apartments and hotels, with the aim of creating a business ecosystem capable of attracting banks, venture capital firms, private equity firms and other investment institutions.

Sim said the proposed financial hub could complement Penang’s technology and semiconductor industries by bringing investors closer to the state’s estimated 20,000 IC design engineers. He said many engineers have technical expertise and business ideas but remain employed by companies partly because they lack access to funding to start their own ventures.

By concentrating technology companies and investment institutions in the same area, he said startups could have greater opportunities to engage with potential investors and obtain funding.

Development on Pulau Jerejak will be subject to environmental, heritage and aviation-related constraints. Large portions of the island are forest reserve, while the developer is limited to its approximately 80-acre landholding. Building height restrictions will also apply.

Sim said the developer had been asked to restore selected historical sites, including the Russian Sailors’ Cemetery. Pulau Jerejak previously served as a quarantine location and retains several historical remnants, making heritage conservation an important consideration in the planned development.

Separately, Sim, who is also Deputy Investment, Trade and Industry Minister, said Malaysia could potentially achieve high-income nation status within the next few years, possibly within two to three years, as the economy continues shifting towards higher-value industries such as electronics, semiconductors and advanced technology.