With commercial rental SST reduced from 8% to 6%, which property type benefits most—office, shoplot, or factory? A clear breakdown for tenants, landlords, and investors.
The Malaysian government’s decision to reduce commercial rental SST from 8% to 6% has brought immediate cost relief to businesses nationwide. However, not all commercial properties benefit equally.
In this article, we compare office, shoplot, and factory rentals to see which segment gains the most from the SST reduction—and what it means for tenants, landlords, and investors moving into 2026.
Understanding the SST Reduction
The SST cut lowers the tax burden on eligible commercial rentals, directly reducing monthly rental costs for tenants. While the percentage change is the same, the actual savings differ significantly depending on rental size, usage, and tenancy structure.
Office Rentals: Moderate Savings, Strong for Corporates
Office tenants—especially MNCs and professional firms—benefit from predictable rental savings. However, many office leases already include negotiated rental packages, making the SST impact less dramatic.
Who benefits most:
- Medium to large office tenants
- Companies leasing Grade A or MSC-status offices
- Long-term office occupiers
Investor impact: Office landlords gain improved tenant retention, but rental yield movement remains relatively stable.
Shoplots: Clear Winner for SMEs & Retailers
Shoplots see one of the most visible benefits from the SST reduction. Retailers, F&B operators, clinics, and service providers operate on thinner margins, making the 2% reduction meaningful.
Why shoplots benefit more:
- High tenant turnover sensitivity to cost
- Rental SST is usually fully passed to tenants
- Monthly cash flow improvement is immediate
Investor impact: Lower tenant pressure reduces vacancy risk and supports rental sustainability, especially in neighbourhood and mature townships.
Factories & Warehouses: Biggest Absolute Savings
Factories and warehouses typically carry the highest rental values, which means the SST reduction delivers the largest absolute cost savings in ringgit terms.
Who benefits most:
- Manufacturers
- Logistics & e-commerce operators
- Cold-chain & food processing businesses
Investor impact: Industrial landlords enjoy stronger tenant stickiness, longer lease terms, and improved yield certainty—making factories and warehouses highly attractive income assets.
Comparison Summary
- Office: Stable savings, corporate-friendly
- Shoplot: Most impactful for SMEs & retailers
- Factory/Warehouse: Largest absolute cost reduction
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Conclusion
The SST reduction from 8% to 6% benefits all commercial property types, but the impact varies. Shoplots gain the most operational relief, while factories and warehouses enjoy the biggest absolute savings. For investors, the policy strengthens tenant stability and reinforces commercial and industrial property as resilient income assets in 2026.
