KPKT Studies Plan to Convert Abandoned Commercial Buildings into Affordable Housing

KUALA LUMPUR (Nov 7, 2025) — The Ministry of Housing and Local Government (KPKT) is undertaking a comprehensive study to explore the redevelopment of abandoned commercial buildings into affordable housing projects, in a move aimed at revitalising underutilised urban spaces while expanding access to homeownership.

Housing and Local Government Minister Nga Kor Ming said the initiative will address Malaysia’s dual challenge of property oversupply and housing affordability by repurposing idle commercial assets into viable residential units.

“A comprehensive study covering legal, technical, and financial aspects is being conducted to ensure such initiatives benefit the public without imposing additional fiscal strain on the government,” said Nga in a media statement on Thursday.

The proposed redevelopment model would involve private developers, government-linked agencies, and financial institutions collaborating to transform abandoned office buildings and commercial property in KL and other major cities into livable housing solutions.

Data-Driven Pricing Model for Affordable Homes

KPKT is also introducing a price mapping system for affordable housing, which benchmarks home prices against median household income at the state and district levels, based on data from the 2022 Household Income and Basic Amenities Survey Report.

This data-driven tool allows developers to set appropriate selling prices based on local affordability levels rather than fixed national caps. The mapping data is accessible via the Affordable Housing Information Dashboard on the Malaysia Urban Observatory website.

According to Nga, this system offers a practical guide for developers to design affordable projects in the right locations — such as office space redevelopments in Bukit Jalil or mixed-use housing in suburban growth zones like Subang and Puchong — aligning supply more closely with demand.

Tackling the Issue of Abandoned Projects

The study follows recommendations from the Real Estate and Housing Developers’ Association (Rehda) Institute, which highlighted that mandatory affordable housing quotas sometimes lead to supply-demand mismatches in areas with limited demand.

“Different states impose varying affordable housing quotas, but certain localities may not have the right market for such units, causing an imbalance,” said Rehda Institute chairman Datuk Jeffrey Ng Tiong Lip.

By repurposing idle commercial and office buildings, KPKT aims to minimise urban wastage, optimise land use, and encourage private-sector participation in Malaysia’s affordable housing agenda — especially across industrial and commercial corridors in Selangor.

PR1MA Campaign to Support Homeownership

Complementing these efforts, Perbadanan PR1MA Malaysia (PR1MA) has launched the “Rumah PR1MA Kita” campaign, offering incentives such as:

• Discounts of up to 25% for selected residential units,

• One year of free internet access,

• Smart home device packages, and

• Full legal fee coverage for first-time homebuyers.

Running until Dec 31, 2025, the campaign aims to ease financial barriers for middle-income Malaysians seeking homeownership.

To further accelerate development, RM38 million has been approved for pre-development works at Bandar PR1MA Teluk Intan, while RM75 million has been allocated for the People’s Housing Project (PRR) Harmoni Bestari Jaya in Selangor — benefiting workers from nearby industrial areas and plantations.

Under Budget 2026, PR1MA will also receive RM30.1 million to initiate three new housing projects next year.

Long-Term Targets Under the MADANI Housing Reform Agenda

Since its inception, PR1MA has completed 91 projects comprising over 54,000 residential units, benefiting more than 175,000 Malaysians. Under the MADANI government’s Housing Reform Agenda, KPKT aims to deliver 500,000 affordable homes by 2030, including 25,000 new PR1MA units across various states.

Upcoming projects include Residensi Brickfields 2 and Bandar MADANI Bukit Jalil in Kuala Lumpur, Residensi Padang Temu in Melaka, Bandar PR1MA Teluk Intan in Perak, and Teluk Kumbar in Penang.

“KPKT remains committed to providing quality, safe, and liveable homes that support the government’s vision of shelter for all Malaysians,” Nga said.

He added that the ministry’s Affordable Housing Policy (DRMM), which caps home prices at RM300,000 (subject to state regulations), has helped raise Malaysia’s homeownership rate to 76.5%.

A New Chapter for Urban Regeneration

By turning abandoned commercial properties into affordable residential developments, KPKT’s plan not only addresses housing needs but also revitalises urban landscapes — particularly in Kuala Lumpur, Selangor, and other key growth corridors.

For developers, it opens new opportunities to repurpose commercial property in KL, industrial land in Selangor, and even factories in Puchong into mixed-use communities, fostering a more balanced and sustainable urban ecosystem.