How Kuala Lumpur’s retail occupancy remained resilient over the long term

Occupancy rates largely remained within 80% to 90% prior to the pandemic.

Retail mall occupancy across Greater Kuala Lumpur continued to recover in the third quarter of 2025, underpinned by improving leasing activity and rising retailer confidence following the pandemic-driven downturn, according to a report by Savills Malaysia.

Savills said the average occupancy rate of retail malls in Greater KL stood at 83.3% in Q3 2025, with performance led by malls in KL City, where occupancy reached 86.9%. This was followed by KL Suburbs at 82.1% and Outer KL at 81.0%, reflecting broad-based improvement across submarkets.

Steady rebound from pandemic lows

The consultancy noted that retail occupancy levels had fallen sharply during the pandemic, bottoming out at 77.0% across Greater KL in 2022. During that period, occupancy in KL City dipped to 73.5%, while KL Suburbs and Outer KL recorded rates of 78.4% and 79.2% respectively.

Since then, occupancy has rebounded steadily, rising to 78.9% in 2023 and further to 82.9% in 2024. According to Savills, this sustained improvement highlights the gradual stabilisation of the retail market as consumer activity normalises and leasing demand strengthens.

Longer-term resilience

Looking further back, Savills observed that retail occupancy across Greater KL has generally remained resilient over the longer term. From 2014 onwards, occupancy rates largely stayed within the mid-80% to low-90% range prior to the pandemic. However, in the period leading up to 2019, rising new supply and intensifying competition moderated overall occupancy, with Greater KL averaging 87.9% in 2018 and 2019.

Prime malls outperform

Savills highlighted that prime and well-established malls continue to outperform secondary locations, supported by stronger footfall, a more resilient tenant mix and proactive asset management. While new retail supply — particularly in Outer KL — continues to come on stream, the consultancy expects dominant malls to maintain stable operational performance.

In contrast, Savills cautioned that secondary retail assets may face greater leasing pressure in an increasingly competitive market environment, as tenants become more selective and gravitate towards better-performing locations.