Malaysia’s Ghost Shops: How Oversupply Is Crippling Local Businesses
Malaysia grapples with escalating concerns over the oversupply of commercial spaces, particularly in expanding suburbs. While new developments continue to rise, many existing units remain vacant, struggling to attract tenants and customers. Experts caution that without better planning, this trend could undermine local business ecosystems and squander valuable resources.
Major states like Klang Valley, Johor, Perak, and Penang already hold a large stock of shoplot-type commercial units. Yet, despite this supply, no single city has been pinpointed as having the highest number of empty premises. Instead, the issue permeates regions where construction outpaces actual demand.
Empty shops breed visible problems. Vacant strips reduce street activity, discourage foot traffic, and make areas less appealing for businesses and shoppers. When units sit idle, capital becomes trapped in unproductive assets, leading to economic inefficiency. Oversupply also harms rental markets. Excess space can push rents down, making it harder for businesses to remain profitable. Short-lived tenancies and unstable local economies often follow, further weakening commercial sustainability. International examples illustrate solutions. Countries like the Netherlands and Japan link new developments to proven demand and optimise existing spaces. By adopting similar strategies, Malaysia could enhance outcomes. Prioritising demand-based planning, thorough feasibility checks, and phased construction would help ensure growth remains healthy and necessary. The aim should be clear: active, tenanted shoplots that serve communities. Well-planned development drives vibrancy, avoids waste, and strengthens local economies.
Better planning could transform Malaysia’s commercial landscape. Demand-led development, efficient land use, and stronger occupancy rates would create more stable business environments. Without changes, oversupply risks leaving more spaces empty, undermining rental markets, and draining resources from productive use.
