Written by Irhamy Ahmad, Founder and Managing Director of Irhamy Valuers International
George Town, Penang, renowned as a UNESCO World Heritage Site, has long been a prime destination for investors, particularly for its pre-war 2-storey shophouses. These properties, which include both pre-war and post-war buildings, are located within the Core Zone and Buffer Zone of the UNESCO Heritage Zone, as well as other parts of George Town. Over the years, their market trends have been shaped by global economic conditions, local demand, and supply constraints.
Between 2018 and 2019, the property market in George Town flourished, driven by strong tourism and growing investor interest. The Core Zone, known for its prime location and rich heritage value, consistently recorded higher property prices than the Buffer Zone, particularly in areas such as Beach Street, Kapitan Keling Mosque Street, Carnarvon Street, and Chulia Street.
However, the arrival of the COVID-19 pandemic in 2020 disrupted the market’s upward trajectory. Economic uncertainty, lockdown measures, and a steep decline in tourism due to Malaysia’s border closures led to a significant drop in both local and international visitor arrivals. This downturn had a ripple effect on tourism-dependent businesses, including hotels, restaurants, and art galleries.
Although transaction volumes fell sharply, property prices remained relatively stable. This stability was largely due to the limited supply of pre-war shophouses, as strict UNESCO conservation policies restricted new developments, preserving the market’s exclusivity.
By 2022, as global economies began to recover and borders reopened, George Town’s property market showed signs of revival. Renewed tourism and the return of foreign investors played a key role in driving demand. By 2023 and 2024, transaction volumes and property prices rebounded, reflecting renewed confidence in the market. The demand for pre-war 2-storey shophouses in George Town remains strong, with recent listings highlighting their lasting appeal:
• Queen Street (1,450 sq. ft.) – RM1.9 million
• Hutton Street (1,694 sq. ft.) – RM1.9 million
• Victoria Street (2,123 sq. ft., renovated) – RM3.8 million
• Beach Street (1,992 sq. ft., prime unit) – RM3 million
These listings demonstrate sustained investor interest, particularly for commercial ventures. The overall market trends from 2019 to 2024 underscore the resilience and investment potential of pre-war 2-storey shophouses in George Town’s UNESCO Heritage Zone. While the pandemic posed challenges, the unique appeal and limited availability of these properties have solidified their status as valuable assets in Penang’s real estate market.
With heritage preservation and tourism continuing to be key market drivers, these properties are expected to maintain their prominence in the years ahead.