Is It Legal to Build a Workers’ Hostel on Industrial Land in Malaysia?

With rising labour demands in Malaysia’s manufacturing and logistics sectors, many factory owners and developers are considering building workers’ hostels directly on or near industrial sites. But is it legal to construct workers’ accommodation on industrial-zoned land? The answer depends on several legal and planning considerations, including zoning regulations, building codes, and state authority approvals.

Understanding Industrial Zoning Regulations

In Malaysia, land use is governed by the Town and Country Planning Act 1976 and local zoning plans issued by each state’s planning department. Most industrial land is classified under categories such as:

• “Perindustrian” (Industrial Use)
• “Perindustrian Berat” (Heavy Industry)
• “Perindustrian Sederhana” (Medium Industry)

To build a workers' hostel legally, the land must either:

• Allow for ancillary uses (including dormitories or quarters), or
• Undergo a planning permission (Kebenaran Merancang) change or variation from the local authority

Guidelines Under Uniform Building By-Laws (UBBL)

Hostel buildings, like any residential-type structure, must comply with the Uniform Building By-Laws (UBBL), which cover:

• Minimum space per occupant (often 3.5–4.0 sqm)
• Ventilation and sanitation requirements
• Fire escape and safety standards
• Separate gender accommodation zones

Failure to meet UBBL standards can result in rejection of building plans or non-issuance of Certificate of Completion and Compliance (CCC).

State-Specific Rules for Workers’ Quarters

State governments and local councils may issue their own circulars and enforcement requirements. Some examples:

• Selangor: Hostels allowed on industrial land only with DBKL/MBSA approval and must be a separate building from the production unit.
• Johor: Certain industrial parks (e.g., in Iskandar) have designated zones for dormitories within the industrial complex.
• Penang: Penang Development Corporation (PDC) requires centralised hostel planning for new industrial phases.

Alternatives to On-Site Hostels

If zoning does not permit hostel development directly on the industrial land, alternatives include:

• Leasing approved purpose-built workers’ dormitories nearby
• Applying for land conversion or land use variation
• Developing off-site hostels under commercial/residential zoning within the municipality

Steps to Build a Legal Hostel on Industrial Land

1. Check the land title and zoning category (via Pejabat Tanah or e-Tanah)
2. Engage a town planner or architect to prepare hostel design per UBBL
3. Submit planning permission (KM) and building plan (Pelan Bangunan) to the local authority
4. Secure State Authority approval and comply with building regulations
5. Obtain CCC after construction for lawful occupancy

Start Your Search for Agricultural, Industrial, or Land Investment

• Explore Agricultural and Development Land for Sale
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While building workers’ hostels on industrial land is possible in Malaysia, it is not automatically allowed. Legal compliance with zoning laws, UBBL standards, and state-specific policies is critical. Engaging professionals early in the planning process will ensure your development is both legal and efficient—minimising enforcement risk and protecting your investment.