Frequently Asked Questions

Zoning & Land Use Approval

• Ensure the land is properly zoned as “industrial” under the local council’s development plan (Rancangan Tempatan).

• Land use must match your business type (e.g. light, medium, heavy industry).

• Conversion of land use (from agriculture to industrial, or commercial to industrial) must be done before purchase if the title doesn’t reflect it.

• Check with:

  • State Land Office

  • Local Municipal Council (e.g. MBPJ, DBKL, MBSA)

Foreigners can buy industrial property, BUT subject to:

Minimum investment value:

• Typically RM 1 million or higher, depending on state
• Some states (e.g. Selangor) may set RM 3 million or more for industrial land

EPU (Economic Planning Unit) Approval:

• Required if the transaction involves RM 20 million+, or
• If it results in foreign control of a Malaysian company State Consent under Section 433B of the National Land Code         
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• Most industrial properties are leasehold (30–99 years).

• Check remaining tenure—if <60 years, it may affect financing and long-term viability.

• Confirm whether lease is renewable and if premium is payable for extension.

Ensure access to:

• • • Highways, ports, or industrial zones

    • Three-phase electricity, water supply, sewerage, and internet

Some industrial sites may lack proper road access or fire safety compliance—these could block licensing.

Check if your intended activity requires:

• Environmental Impact Assessment (EIA) for hazardous or polluting operations

• Licensing from local authorities (e.g. DBKL, DOE, MITI)

If the land was previously used, verify:

• No contamination (especially in chemical-related industries)

• Proper closure or conversion approvals from past use

RPGT applies to both individuals and companies:

• • Foreign individual: 30% (years 1–5), 10% (year 6+)

  • Foreign company: Same rate as individuals

Strategic planning is needed if land will be flipped or held short-term

If buying a built industrial facility (factory, warehouse):

• Review certificates of completion (CCC/CF)

• Confirm building plans were approved

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Foreign companies can finance through local banks, but:

• Loan margin may be limited (typically 50%–70%)

• Need Malaysian-registered entity (e.g. Sdn Bhd)

• MM2H and individuals generally cannot buy industrial land for personal use

Many foreign investors set up a local company (Sdn Bhd) for industrial ownership to ease EPU/state approval and loan access

• Title Search / Grant – Confirms ownership, restrictions, tenure
• Zoning Confirmation Letter – Verifies industrial zoning from local authority
• Land Conversion Approval – If land is not yet gazette as industrial
• SPA (Sale & Purchase Agreement) – Ensure proper terms on zoning, tenure, building use
• State Consent Letter – Approval under National Land Code Section 433B
• EPU Approval (if required) – Approval for transactions involving foreign control or RM 20M+ value
• Tax Clearance & Quit Rent – To confirm no outstanding dues
• Building Approval / CCC – To verify legal structure and occupancy certification

• Zoning & land use – To ensure you’re legally allowed to operate your business
• State consent & EPU approval – Without these, ownership transfer is invalid
• Leasehold tenure – Impacts value, financing, and renewal prospects
• Infrastructure readiness – Critical for operations and expansion
• Legal building approvals – Prevent future fines or demolitions
• Environmental & operational licenses – Especially for manufacturing or logistics
• Ownership structure – Most foreigners buy through a Malaysian-registered Sdn Bhd

Legal & Ownership Requirements

• ✅ Confirm the minimum purchase price for foreigners (typically RM1 million and above; varies by state).

• ✅ Check the land tenure — most industrial lands are leasehold, with limited freehold availability.

• ✅ Obtain state authority consent before completing the transaction.

• ✅ Verify land zoning for the intended industrial use (factory, warehouse, logistics, etc.).

• ✅ Review the title deed for any encumbrances or caveats.

Financial & Tax Considerations

• ✅ Calculate total acquisition costs, including stamp duty, legal fees, and valuation charges.

• ✅ Understand Real Property Gains Tax (RPGT) and annual assessment obligations.

• ✅ Check bank financing options for foreign buyers (or explore corporate/joint venture financing).

• ✅ Consider currency exchange rate and tax implications for profit repatriation.

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Property & Infrastructure Evaluation

• ✅ Assess accessibility to highways, ports, and airports.

• ✅ Confirm the availability of utilities (power supply, water, broadband, natural gas).

• ✅ Inspect the building condition or development status (if under construction).

• ✅ Check for flood risk or environmental contamination.

• ✅ Review the plot ratio, land size, and potential for future expansion.

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Regulatory Compliance

• ✅ Ensure compliance with environmental, safety, and fire regulations.

• ✅ Confirm licensing requirements with MIDA or MITI (for manufacturing or export-related businesses).

• ✅ Review local authority approvals for renovations or factory setup.

Property Types Foreigners Can Buy

• Industrial and commercial properties (factories, warehouses, offices, retail spaces)

• Residential properties (condominiums, serviced apartments, landed homes — subject to price limits)

Minimum Purchase Price

• Kuala Lumpur – RM1 million and above

• Selangor – RM2 million and above (varies by zone and property type)

State Authority Consent

All foreign property purchases require State Authority approval, known as “State Consent.”
This is usually obtained by your lawyer and can take 1–3 months.
The process ensures:

• The buyer meets the minimum price requirement

• The property isn’t restricted (e.g., Malay Reserve or Bumiputera lot)

Land Tenure

• Freehold: Limited but available in certain areas.

• Leasehold: Common for industrial and commercial lands, typically 30–99 years.
  Foreigners can own both, but leasehold tenure must be long enough to be viable for investment.

Ownership Structure

• Individually, under their own name

• Through a locally incorporated company (with foreign shareholding)

• Via a Labuan company or Malaysia My Second Home (MM2H) status (for residential)

For industrial property, many buyers use a Malaysian-registered Sdn. Bhd. entity for operational and tax purposes.

Taxes & Fees

• Stamp Duty (1–3%)

• Legal Fees

• Real Property Gains Tax (RPGT) on disposal

Financing

• Foreigners can obtain local bank financing, but typically up to 70% loan margin.

• Proof of income or corporate documents may be required.

• Some buyers use foreign loans or joint ventures to fund the purchase.

Additional Approvals (for Industrial Use)

• Environmental Impact Assessment (EIA) for certain activities

• MIDA/MITI licensing for manufacturing operations

• Local authority approvals for building plans and usage

For industrial property, additional permits may be needed depending on the intended use.