Malaysia's office construction boom could lead to a Dubai-style property bust, CIMB warns, but other analysts expect a more muted correction.
Dubai's early story is similar to Malaysia's current ambitions, CIMB said, noting both had plans to build iconic "tallest" office towers and other commercial projects to lift industry standards and alleviate Grade-A office space shortages.
But CIMB noted, Dubai had a "one-up" given demand from Fortune 500 companies already located there and steady occupancy rates around 97 to 99 percent, compared with Malaysian capital Kuala Lumpur's occupancy in the low to mid 80 percent range.
(Read more: Dubai real estate is hot again—maybe too hot: IMF)
After years of frenetic development, which included constructing the world's tallest building, Dubai suffered a massive real-estate crash in the wake of the 2008 financial crisis, with property losing more than 50 percent of its value by 2011 as excessive speculation came home to roost. CIMB noted half-empty buildings continue to plague Dubai's skyline.
On the slate for the Kuala Lumpur area are the 118-story Warisan Merkeka Tower, targeted as the tallest building in Southeast Asia and part of a huge complex that will include two condominium blocks, a hotel tower and an underground subway station, as well as the 28-building Tun Razak Exchange project targeted as an international financial hub, CIMB noted.