PETALING JAYA: Landbanking activity has been subdued across the property sector this year, but the moderation should not be mistaken for a lack of confidence – with developers remaining disciplined and selective in pursuing new acquisitions, say experts.
A property analyst said a slowdown in acquisitions may actually reflect capital discipline rather than pessimism.
“Many listed developers already have sizeable landbank that can sustain launches for years, reducing the immediate need to replenish their inventories,” he told StarBiz.
He added that many developers are prioritising the execution of existing projects, preserving balance sheet strength and managing capital more prudently.
“This is amid a more selective property market, higher financing costs and ongoing construction cost pressures.
“Rather than pursuing expansion for its own sake, many are focusing on improving margins, monetising their existing landbank and delivering projects on schedule,” he noted.
Another analyst concurred with this sentiment, saying the slower pace of land acquisitions this year is better viewed as a “strategic shift towards disciplined business decisions.”
“While developers remain selective about new purchases, they continue to seek opportunities that are well located, attractively priced and capable of generating sustainable returns.
“Moreover, softer residential transactions, tighter housing loan approvals and affordability concerns have made developers more disciplined when evaluating new land purchases. We expect consolidation rather than aggressive expansion in 2026.”
An industry observer said landbanking activity has moderated over the past three years. “In 2023, there was a strong recovery after the pandemic, as many developers resumed acquisitions.
“This trend continued into 2024. It was very active. Companies like Mah Sing Group Bhd
, Sunway Bhd, Eco World Development Group Bhd and Scientex Bhd, to name a few, acquired numerous sites as confidence improved.”
He said 2025 was the “peak of the cycle”.
“Mah Sing alone acquired several strategic sites, including the Corus Hotel redevelopment and Johor industrial land, while other major developers also replenished their landbank.”
Going into 2026, experts said landbanking activity has been “noticeably slower.”
“Only a handful of meaningful acquisitions have been announced, with most developers relying on existing landbank,” said a market observer.
Land acquisitions, particularly “significant” ones, have been limited this year.
One of the more notable land acquisitions this year was by Sunway, which announced in January that it was acquiring three land parcels in Selangor and Penang for RM179.8mil as part of efforts to replenish its development landbank and strengthen its future project pipeline.
Meanwhile, Sime Darby Property Bhd and sister company SD Guthrie Bhd announced last week that they were moving forward with their joint venture to develop a mega industrial and logistics corridor in Kuala Selangor through the injection of 1,021.93 acres of land in Bukit Kerayong Estate, Kapar.
Going into the remaining months of the year, industry experts believe more land acquisitions are “in the offing” as developers look to replenish their landbank within strategic sites, or if the right opportunity arises.
“Yes, the pace of land acquisitions is likely to pick up in the second half of the year, although developers are expected to remain highly selective rather than embark on aggressive landbanking,” said an analyst from a local bank-backed brokerage firm.
He said there are several factors that would support a more active acquisition environment.
“First, many listed developers continue to report healthy balance sheets, strong unbilled sales and sizeable cash reserves, giving them the financial capacity to replenish their landbank.
“Second, if residential sales continue to hold up and construction costs do not escalate significantly, developers will be more confident committing capital to new sites.”
He added that larger developers with established township developments and stronger financial positions are especially well placed to pursue strategic acquisitions in the coming months.
“That said, developers are unlikely to acquire land simply for the sake of expanding their landbank. Instead, they are expected to focus on sites that offer quick development turnaround, are located within or adjacent to existing townships, or can be acquired at attractive valuations.
“Acquisitions are also likely to be concentrated in proven growth corridors where demand remains resilient, particularly in the Klang Valley, Johor and Penang.”
