Malaysian prime malls hold their ground as retail sentiment softens

Prime shopping malls remain key gateways for international brands.

Prime shopping malls in Malaysia continue to serve as key entry points for international and premium retail brands, even as overall retail sentiment softened in 2025 amid rising living costs and more cautious consumer spending, according to a recent report by Savills Malaysia.

Savills noted that retail conditions weakened during the year as consumers adjusted to higher household expenses following utility tariff revisions and the expansion of the Sales and Service Tax (SST). While government initiatives such as the BUDI95 fuel subsidy and the RM100 Sumbangan Asas Rahmah (SARA) credit helped cushion the impact, consumer behaviour became more selective after a strong start to the year, resulting in slower retail growth.

Against this backdrop, Savills observed a growing polarisation in the retail landscape. Top-tier malls have continued to outperform, acting as launch platforms for first-to-market brands, flagships and regional debuts, while suburban centres remain largely anchored by necessity-driven retail and local operators.

“Premier malls have reinforced their role as Malaysia’s preferred testing ground for international retail expansion,” Savills said in the report, adding that global brands remain highly selective in choosing locations that offer strong footfall, brand visibility and affluent catchments.

Several leading malls recorded notable leasing activity during the year. Suria KLCC enhanced its tenant mix with the arrival of Benihana’s first Malaysian outlet, The Shirt Bar’s debut store, and Salomon’s first open-concept store in the country. The mall is also set to welcome Smith & Wollensky’s first Southeast Asian outlet, further strengthening its international appeal.

At The Exchange TRX, Savills highlighted the opening of POP MART’s largest store in Malaysia alongside Devialet’s first local flagship, underscoring the mall’s positioning as a destination for global lifestyle and tech-forward brands.

Meanwhile, Mid Valley Megamall attracted One-Two-Boost’s first outlet in Malaysia and The Ordinary’s second store in Southeast Asia, reflecting continued interest from international beauty and wellness brands in established high-traffic centres.

Other prime malls also saw first-to-market entries. Pavilion Kuala Lumpur welcomed SPARKORA BBQ’s first Malaysian outlet, while bakery chain Tous Les Jours returned to expansion mode with new stores at Sunway Pyramid and Sunway Velocity Mall, marking its first openings after a period of absence.

Savills added that brand expansion was not confined to the urban core. MUJI opened a new store at IOI Mall Puchong, AAPE launched a boutique at IOI City Mall Putrajaya, and Kinokuniya inaugurated its second Malaysian outlet at Pavilion Damansara Heights. At Pavilion Bukit Jalil, lifestyle concept O.C.E. debuted its first store.

In addition, Mitsui Outlet Park’s urban-format outlet mall at LaLaport BBCC was cited as a milestone development, representing Malaysia’s first outlet-in-mall concept within a city-centre location, further diversifying the country’s retail formats.

Looking ahead, Savills expects the divergence between prime and non-prime retail assets to persist. While consumer sentiment remains cautious, the consultancy said well-located, well-curated malls are likely to retain their competitive edge, particularly those capable of attracting international brands seeking controlled, high-impact market entry into Malaysia.