At a glance
| Question | Answer for industrial property in Johor |
|---|---|
| Is approval needed? | Yes, prior approval of the State Authority, for purchases and registrable leases |
| Who counts as foreign? | A company incorporated abroad, or a Malaysian company with 50% or more of its voting shares held by foreigners |
| Minimum price | RM1 million |
| State approval fee | 4% of the value, plus an RM2,000 application fee per title |
| Stamp duty | 4% flat for foreign buyers on non-residential property; 1–4% scale otherwise |
| Typical approval time | 3–6 months |
| Typical offer-to-completion | About 6–9 months; longer for leasehold land with extra consents |
1. Who counts as "foreign"
Under section 433A of the National Land Code, a "foreign company" includes:
- a company incorporated outside Malaysia;
- a Malaysian company with 50% or more of its voting shares held by non-citizens or foreign companies, or a mix of both;
- a Malaysian company whose shares are held through a chain of such companies.
What this means in practice: setting up a Malaysian Sdn Bhd does not avoid the rules if foreigners hold 50% or more of the votes. Lawyers note that shareholding is tested at the time the land is acquired.
2. State approval: when it applies
Section 433B requires a foreign company to obtain the State Authority's prior written approval before acquiring land, whether by transfer or by lease. A dealing made without it is void. Industrial land used to be exempt, but that exemption was removed from 1 January 2017, so factories, warehouses and industrial land now all need approval.
In Johor, applications go to the Office of the Director of Lands and Mines (PTG Johor). Many industrial titles, especially leasehold ones, also carry a restriction in interest, which needs a separate state consent before the land can be transferred, leased or charged. This applies to Malaysian buyers too, and comes on top of the foreign-interest approval.
Financing is treated differently: the law does not require state approval for a foreigner to take a charge over land as a lender.
3. Minimum price and what foreigners cannot buy
| Category | Minimum for foreign interests in Johor | Not allowed |
|---|---|---|
| Industrial | RM1,000,000 | — |
| Commercial | RM1,000,000 | Shops and shop-offices under three storeys, stalls, service workshops |
| Agricultural | RM1,000,000 or more than 15 acres, whichever is higher | Homestead-concept agricultural land |
Foreign interests also cannot acquire Malay Reserve land, lots allocated to Bumiputera (unless the state has released them) or gazetted heritage property. These limits are from the Malaysian Bar's December 2024 summary of state thresholds; the state can change them, so confirm the current position for the specific property.
4. The Johor approval fee
PTG Johor Circular 3 of 2025, effective 1 July 2025, sets the fees for foreign-interest approvals:
| Category | Purchase from developer | Subsale | Lease |
|---|---|---|---|
| Industrial | 4% of the stamped SPA value | 4% of the official valuation (JPPH) or the price, whichever is higher | 4% of the stamped lease value |
| Commercial | 3%, minimum RM30,000 | 3%, minimum RM30,000 | 3%, minimum RM30,000 |
There is also an RM2,000 application fee per title, with further RM2,000 charges to extend an approval or for paying the fee late. Example: on a RM10 million factory, the industrial approval fee would be about RM400,000, on top of stamp duty and legal fees. Build it into the budget from the start.
5. Other costs: stamp duty and RPGT
Stamp duty on the transfer
Since 1 January 2024, foreign companies and foreign individuals pay a flat 4% on non-residential property. The 8% rate introduced from 1 January 2026 applies to residential property only. Other buyers pay the standard scale: 1% on the first RM100,000, 2% on the next RM400,000, 3% on the next RM500,000 and 4% above RM1 million. On a RM10 million factory the difference is small: about RM400,000 at the flat rate against about RM384,000 on the scale.
The published sources do not settle whether a foreign-owned Malaysian Sdn Bhd is a "foreign company" for stamp duty purposes. Ask your lawyer or tax adviser for the position on your structure.
Real property gains tax (RPGT) when you sell
| Years held | Malaysian-incorporated company | Company incorporated abroad |
|---|---|---|
| Up to 3 | 30% | 30% |
| 4th year | 20% | 30% |
| 5th year | 15% | 30% |
| 6th year onwards | 10% | 10% |
On a purchase, the buyer must hold back part of the price for the tax authority: 7% if the seller is a foreign individual or a company incorporated abroad, 5% if the seller is a Malaysian company selling within three years, and 3% otherwise.
6. Other approvals you may need
- Ministry of Economy: needed only for acquisitions of RM20 million or more from Bumiputera owners or government agencies. Buying from a private, non-Bumiputera seller needs state approval only.
- Manufacturing licence (MIDA): required for manufacturers with shareholders' funds of RM2.5 million or more, or 75 or more full-time employees. A fast-track route is reported for JS-SEZ projects.
- Land use: check that the title's category and conditions allow your intended use. Converting agricultural land to industrial use can take 6 to 18 months.
- Company set-up: earlier Johor guidelines required industrial land to be held through a locally incorporated company. Most foreign buyers use a Malaysian Sdn Bhd; take legal advice on the right structure.
7. Leasing instead of buying
Leasing does not avoid the rules. A registered lease (longer than three years) is a dealing under the National Land Code, so a foreign company needs state approval for it too, and Johor charges the same 4% fee on the stamped value of an industrial lease. Tenancies of three years or less are not registered and are generally treated differently; confirm the position with your lawyer before relying on it. Some parks, such as Johor Corporation's Tanjung Langsat estate, offer fixed 30- or 60-year leases.
8. A realistic timeline
| Stage | Typical timing |
|---|---|
| Offer letter and earnest deposit (usually 2–3%) | Day 0 |
| SPA signed, deposit topped up to 10% | About 2–3 weeks later |
| State approval, plus restriction-in-interest consent if needed | About 3–6 months in Johor |
| Completion period, starting once approval is received | Usually 3 months, often with a 1-month extension |
| Overall, offer to completion | About 6–9 months; longer for leasehold land needing several consents |
These are typical ranges reported by law firms. The State Authority has full discretion, so neither approval nor timing can be guaranteed. SPAs usually set a deadline for obtaining consent, with an option to extend.
Before you sign
- Confirm whether your buying entity is "foreign" under the 50% test, and choose the structure with your lawyer before the offer.
- Search the title: category of use, express conditions, restriction in interest, Malay Reserve or Bumiputera status, and any charges.
- Check the price meets the RM1 million minimum and that the property type is allowed.
- Budget the 4% approval fee, stamp duty, legal fees and any RPGT retention.
- Make the SPA conditional on state approval, with a realistic deadline and an extension option.
- Check whether you also need a manufacturing licence or a change of land use.
Sources
- PTG Johor, "Pekeliling PTG Johor Bil. 3 Tahun 2025: Pelaksanaan pindaan kadar, Kaedah-Kaedah Tanah Johor 1966", 13 Jun 2025, effective 1 Jul 2025.
- Malaysian Bar, "Circular No 444/2024: Restrictions in respect of non-citizens and foreign companies under Part 33A of the National Land Code", 23 Dec 2024.
- PTG Johor, "Pekeliling PTG Johor Bil. 1/2010: Garis panduan perolehan hartanah oleh kepentingan asing", 30 Mar 2010 (historical).
- PTG Johor, "Senarai semak borang pindahmilik" and "Senarai semak borang pajakan", 2026.
- Shearn Delamore & Co (via Conventus Law), "National Land Code (Amendment) Act 2016", 2 Nov 2017.
- Halim Hong & Quek, "Johor property boom and the new legal and tax framework for foreign acquisitions", 6 Oct 2025.
- Halim Hong & Quek, "Property transactions: when State Authority consent is required", updated 18 Oct 2024.
- Azmi & Associates (via Conventus Law), "Outlining the manufacturing investment process in the JS-SEZ", 17 Aug 2026.
- Azmi & Associates (via Conventus Law), "Essential factors for foreign investors purchasing or leasing land in Malaysia", 17 Jun 2024.
- Nazmi Zaini Chambers, "Malaysia's legal framework for acquisition of real estate by a foreign company", 24 Mar 2025.
- Mah Weng Kwai & Associates, "Property transactions requiring state consent", updated 20 Jun 2024.
- Donovan & Ho, "Cash flow and timing of a sub-sale purchase by foreigners", updated 22 Mar 2024; and "What to do if the seller delays the SPA", updated 22 Mar 2024.
- The Edge Malaysia, "Increased levy to have minimal impact on Johor property market", 8 Jul 2025.
- PwC Malaysia, Malaysian Tax Booklet 2026/2027: "Stamp duty" and "Real property gains tax", accessed 25 Oct 2026.
- Skrine, "The proposed amendments to the Stamp Act 1949", 15 Nov 2023; and "Proposed amendments to the Stamp Act", 24 Nov 2025.
- KPMG, "Malaysia: tax measures in Finance Act 2025", Jan 2026.
- Baker McKenzie, "Global Corporate Real Estate Guide: Malaysia, leases", accessed 25 Oct 2026.
- Ministry of Economy, "Guideline on the acquisition of properties", effective 13 Jul 2022, page updated 23 Oct 2026.
- MIDA, "Approvals and licensing", accessed 25 Oct 2026.
- StarProperty, "How long does it take for an SPA to be completed?", 27 May 2018.
Planning a purchase or lease in Johor?
Share your brief. I will shortlist industrial property that meets the foreign-ownership rules and set out the full acquisition cost, so you and your lawyer can decide on a clear basis.
This guide summarises publicly available law, state circulars and professional commentary as at 25 October 2026 for general information only. Rules, thresholds, fees and processing times can change, and the State Authority has full discretion over approvals. It is not legal, tax or financial advice. Engage a Malaysian lawyer and tax adviser before making any offer or signing an agreement. Ronald Mak | Johor Realtor (REN 80365), PropNex Realty Sdn. Bhd. (1264951-W), E (1) 1800/2.