Forest City Special Financial Zone: A Strategic New Choice for Family Offices

Forest City Special Financial Zone: A Strategic New Choice for Family Offices

In August 2023, Malaysia’s Prime Minister Anwar Ibrahim announced the designation of Forest City as a Special Financial Zone (SFZ). The following September, the Crown Prince of Johor, Tunku Ismail, together with officials from the Ministry of Finance, unveiled a set of concrete policies positioning the SFZ as a complementary financial hub to Singapore—forming a “twin financial engine” for Southeast Asia. By April 2025, Malaysia’s King, Sultan Ibrahim, further emphasized Forest City’s role as a key investment platform within the Johor-Singapore Special Economic Zone (JS-SEZ) during high-level bilateral meetings with China. As a “As a “special zone within a special zone,” Forest City demonstrates not only national-level backing but also the foresight of regional development strategy.

Tax Advantages: Malaysia’s First Zero-Corporate-Tax Policy for Family Offices

At the heart of Forest City’s appeal is its pioneering tax regime. The SFZ introduces Malaysia’s first-ever 20-year exemption from corporate income tax for family offices and related investment holding structures established in the zone—significantly reducing operational costs and tax burdens. Unlike Singapore, where family office asset thresholds start at SGD 20 million, Forest City requires only MYR 30 million (approx. USD 6.3 million). In comparison with neighboring jurisdictions, this policy positions Forest City as a highly competitive wealth management base across the Asia-Pacific region.

Knowledge-based professionals such as investment managers and financial advisors benefit from a 15% personal income tax rate, while fintech-related enterprises enjoy corporate tax rates as low as 5% for 20 years. Eligible firms may also qualify for up to 10 years of additional corporate tax exemptions, further amplifying the zone’s attractiveness to domestic and international investors alike.

Strategic Location and Residency Benefits

Forest City’s proximity to Singapore offers unparalleled access: just a 10-minute drive to the Second Link checkpoint and about 40 minutes to Singapore’s Central Business District. This connectivity ensures the zone not only benefits from JS-SEZ spillover effects but also integrates seamlessly into the region’s cross-border transport and lifestyle infrastructure.

For international families, Forest City offers an enhanced “Malaysia My Second Home” (MM2H) residency program. With requirements starting from only MYR 500,000 in property purchases and reduced fixed deposit thresholds, the scheme provides family members with greater flexibility for long-term residence and travel.

Efficient Investment Facilitation

To support business establishment and daily operations, the Malaysian government has launched the Malaysia Investment Facilitation Center – Johor (IMFC-J) within Forest City’s Financial Center. This one-stop service hub provides corporate registration, legal advisory, tax guidance, and visa assistance, dramatically streamlining approval processes and improving the investor experience.

Complementing this are Forest City’s robust city-level amenities, including international school, star-rated hotels, two international standard golf courses such as the Legacy Course, healthcare facilities, and a Harbor commercial street featuring nearly 100 retail and service outlets. Together, these create a world-class ecosystem for both living and working.

Southeast Asia’s accelerating economic integration has fueled rising demand for cross-border investment and wealth management solutions. As a flagship national project, Forest City is emerging as a strategic choice for family offices seeking a secure and advantageous base in the region. Its policies are designed not only to offer short-term incentives but also to foster a long-term, sustainable ecosystem for wealth and business operations.

For global family offices, Forest City represents more than a tax-efficient location—it is a forward-looking platform at the crossroads of finance, trade, and lifestyle, poised to redefine the landscape of wealth management in Southeast Asia.