Budget 2027 highlights Sime Darby Property's RM1.25b data-centre fund, TNB's RM15b grid investment
Malaysia's Budget 2027 has highlighted Sime Darby Property's RM1.25 billion New Economy Venture Fund for data centres and logistics, alongside RM15 billion in grid investment by Tenaga Nasional Bhd. The fund, which secured full commitments at first close, targets built-to-suit data centres and indus
PETALING JAYA (Oct 9): Budget 2027 has highlighted Sime Darby Property's existing RM1.25 billion New Economy Venture Fund for data centres and industrial and logistics developments, alongside RM15 billion in investment by Tenaga Nasional Bhd (TNB) to strengthen the national grid.
Prime Minister and Finance Minister Datuk Seri Anwar Ibrahim cited the fund's development of data centres and logistics assets in Elmina, Selangor, as an example of the RM25 billion in domestic investments being mobilised by government-linked investment companies through GEAR-uP. Launched on June 9, the fund secured full capital commitments at its first close. Its institutional investors include the Employees Provident Fund (EPF), Lembaga Tabung Angkatan Tentera (LTAT) and Great Eastern Life Assurance (Malaysia) Bhd.
Sime Darby Property acts as general partner and sponsor and committed RM500.1 million as a co-investor at first close. According to the developer, the fund invests in data centres built to tenants' requirements for leasing, as well as industrial and logistics developments across its key Malaysian townships. Its two seed assets are located in Elmina Business Park and the City of Elmina and represent about 85% of the fund's target size. Construction had commenced on both assets, with completion expected in the second half of 2027.
On electricity infrastructure, Anwar said TNB would invest RM15 billion to strengthen the national grid and ensure continuity of supply. UEM Lestra will separately invest RM1 billion, including in an energy storage project at Kuala Lumpur International Airport and a hybrid energy project with a capacity of one gigawatt in Johor. Retirement Fund (Incorporated), or KWAP, will also deploy its RM1 billion Climate Fund for green projects, including renewable energy and decarbonisation.
The infrastructure measures come as data-centre expansion increases electricity demand. Reuters reported on Oct 9 that TNB expects Peninsular Malaysia's electricity consumption to rise 4.9% to 148.66 terawatt-hours in 2027, driven by the sector's rapid growth. According to Bernama's July report of a parliamentary reply, TNB supplied electricity to 36 operating data centres with planned supply capacity of about 4.5 gigawatts through the first quarter of 2026. Another 23 projects under construction represented a maximum demand capacity of 3.8 gigawatts.
The Budget also provides for improved green technology tax incentives, extended until Dec 31, 2030. Companies undertaking qualifying green and sustainable technology projects, including electric vehicle charging stations, will qualify for investment tax allowances of up to 100%. Companies purchasing qualifying green technology assets for their own use will also qualify for allowances of up to 100%.
In Johor, the Budget identifies Nexus Sedenak as a new industrial growth centre in the northern part of the Johor-Singapore Special Economic Zone (JS-SEZ), with investment potential of RM12 billion and the potential to support 45,000 jobs. Anwar and Singapore Prime Minister Lawrence Wong are scheduled to launch the JS-SEZ master plan and blueprint at the end of this year.
