Developers turn to land recycling as costs bite [WATCH]

By Sharen Kaur

July 9, 2026 , New Straits Times

KUALA LUMPUR: There is a growing trend among property developers to recycle mature land assets in key areas in Kuala Lumpur as financing costs remain elevated and project execution becomes more capital-intensive, experts said.

They also said demand for well-located mixed-use developments in Kuala Lumpur's city centre remained resilient, particularly projects combining residential, hospitality and retail components, although developers would need to carefully phase launches to match market absorption.

Chin Hin Group Property Bhd said on Wednesday that it will acquire a prime freehold land parcel in the city centre from YNH Property Bhd under a RM455 million deal that paves the way for a mixed-use development with an estimated gross development value (GDV) of RM3.6 billion.

The companies have signed a conditional sale and purchase agreement for the 10,564-square-metre site along Jalan Sultan Ismail. Under the transaction, YNH's wholly owned unit YNH Land Sdn Bhd will sell the land to Chin Hin Property (JSI) Sdn Bhd, a subsidiary of Chin Hin Group Property.

The proposed development will comprise serviced apartments, a hotel and retail space, with an estimated total development cost of RM2.72 billion, subject to final plans and regulatory approvals.

The transaction gives Chin Hin Group Property full control over the project's development while allowing YNH to monetise a long-held asset, strengthen its balance sheet and retain a 10 per cent stake in the future development.

"Opportunities to acquire a freehold development site of this scale and location in the city's Golden Triangle are exceptionally rare," Chin Hin Group Property executive chairman Datuk Wira Chiau Haw Choon said in a statement.

YNH managing director Yu Kai Leun said the transaction formed part of the group's capital recycling strategy.

"This transaction allows us to unlock meaningful liquidity from a prime asset, strengthen our financial position, and retain a continuing participation in the asset's future upside," he said.

"For YNH, this represents a highly balanced outcome. We are converting a long-held landbank into immediate capital while preserving our connection to a landmark project," added Yu.

Analysts said the deal appears strategically positive for both developers, allowing Chin Hin Group Property to secure one of the few remaining large freehold redevelopment sites in Kuala Lumpur's central business district while enabling YNH to unlock capital tied up in its landbank.

"For Chin Hin Group Property, the acquisition significantly enhances its premium city-centre landbank and provides earnings visibility over the longer term through a sizeable flagship development," he said.

For YNH, it improves liquidity and reduces capital tied up in undeveloped land while allowing it to participate in future value creation through its retained stake, the expert said.