Malaysia has to the potential to do very well economically in next 20 years. And I think the Johor area has the best prospects in Malaysia. From the investment point of view, probably the greater the GDP growth the more money will be made (other factors matter: urban planning, safety, good mass transit and education... but with strong GDP growth investments will likely be very profitable) by investors. But if Iskandar is successful there will also be new problems that need to be dealt with.
While I agree with your POV, I had my own reservation which some businesses also felt the same.
In my circle of business acquaintances, many shared that the current co-operation with MY Johor is plausible
because an 80 plus years old man is still running the show albeit with less media exposure.
Many, including me, share that thought that the real test will come after the passing of the old man.
Nobody knows if Malaysia will continue their cordial relationship with Sg after old man passing.
That is why not many businesses relocate to Malaysia as fast as it should be.
Only after the passing of the old man can we tell the real relationship between MY and SG.