Malaysia’s tourism sector recorded 42.2 million visitors in 2025, translating to an 11.2% increase y-o-y

• Short-haul Asian markets continue to be the primary driver of Kuala Lumpur’s tourism growth, accounting for nearly 87.6% of total arrivals. Key source markets include Singapore, China, Indonesia, India and Thailand.
• This comes ahead of the Visit Malaysia 2026 campaign, which aims to attract 43 million international visitors in 2026, supported by a calendar of more than 300 events throughout the year.

Kuala Lumpur’s total hotel room inventory stood at approximately 70,000 rooms as of year-end 2025

• The market is projected to see the addition of approximately 4,600 new rooms between 2026 and 2028, representing a three-year compound annual growth rate (CAGR) of approximately 2.1%.
• A significant influx of new supply, heavily weighted towards the luxury segment (approximately 60%), is expected to elevate Kuala Lumpur’s hospitality market by raising the industry-wide price ceiling and average daily rates (ADR).

The influx of international tourists in the first quarter of 2026 has translated into improved trading performance

• The Kuala Lumpur luxury hotel segment’s RevPAR expanded by 1.1% Y-o-Y in 2025, surpassing 2019 levels by 22.7%. This was driven by a 1.7% Y-o-Y increase in ADR, despite a marginal 0.4 percentage point decline in occupancy.
• As of YTD March 2026, the Kuala Lumpur luxury hotel segment continues to experience an upward trend. RevPAR is currently 5.7% higher than the same period in 2024, as a result of a 3.4 percentage point growth in occupancy rates.

Outlook: Strategic investments in tourism and diversification into medical tourism to drive the visitor economy

• The Visit Malaysia 2026 campaign is projected to drive international arrivals to a record 43 million, generating an estimated RM147.1 billion in tourism receipts and solidifying the country’s position as a premier global destination.
• Kuala Lumpur and Johor Bahru are also successfully diversifying their tourism sectors by focusing on high-value medical travel, leveraging Kuala Lumpur’s world-class facilities and Johor Bahru’s strategic proximity to Singapore.