KUALA LUMPUR – Johor’s Forest City is gearing up to establish itself as a family office hub, with Malaysia’s Second Finance Minister Amir Hamzah Azizan confirming that key details, including incentives and eligibility criteria, will be unveiled in the first quarter of 2025.
The initiative aims to attract ultra-high-net-worth families with a zero-percent tax rate and a minimum asset threshold of RM30 million (S$9 million) for setting up family offices, significantly lower than Singapore’s S$20 million requirement.
“We’re not directly competing with Singapore. Instead, we aim to attract markets underserved by other hubs,” Amir said on Sunday. He added that Malaysia’s lower operational costs could make Forest City’s Special Financial Zone (SFZ) an appealing alternative for family offices seeking a more affordable base in the region.
Forest City, a US$100 billion (S$134 billion) development near Singapore, has faced challenges in recent years but is now being revitalized as a financial and investment hub. The Malaysian government designated the area as a SFZ in August 2023, offering incentives to foreign investors as part of its strategy to boost the southern state’s economy.
Wealth management firms have reportedly shown strong interest in the SFZ. “Feedback from the industry has been very positive, with early indications that several firms are preparing to establish a presence,” Amir said.
Experts, however, caution that a zero-tax policy alone may not suffice to attract investors. A supportive ecosystem—including high-quality advisory and fund management services—will be critical to Forest City’s success. “Family offices will need assurances that they can access the same level of expertise and resources as they would in established hubs like Singapore,” said PwC Malaysia tax partner Fung Mei Lin.
The federal government also hopes the SFZ will create high-paying jobs in Johor, with family office managers earning an estimated RM10,000 monthly or more. This initiative is part of Malaysia’s broader efforts to counter brain drain and boost local wages, particularly in Johor, where competition with Singapore for skilled labor is fierce.
Amir emphasized that the project is not just about economic growth but also about improving quality of life. “We don’t need to match wages dollar for dollar. What we need is to provide opportunities for growth and ensure that people can thrive while enjoying a good quality of life in Johor,” he said.
Forest City’s evolution into a wealth management hub reflects Malaysia’s ambition to carve out a unique niche in the competitive landscape of regional financial centers.