Lim said a 4.5 kilometre test track, to be conceived by an as-yet unnamed F1 track designer, will be part of a motorsports-themed development known as 'Motorsport City'.
The venture, of which Lim's FASTrack Autosports Pte has a 70 per cent holding, is valued at more than $1.2 billion.
It is planned for the Johor state, which borders Singapore, just five minutes drive from the Tuas Second Link border crossing between the two countries.
Malaysia already has a permanent Grand Prix track in Sepang, which has hosted 14 F1 Grands Prix since first being included on the calendar in 1999.
Singapore, meanwhile, hosts F1's only night race, and agreed to a five-year extension with F1 supremo Bernie Ecclestone in September.
"The region is fast becoming a hub for motor sports," Lim, a shareholder of McLaren Automotive, is quoted as saying by Bloomberg.
Malaysian developer UEM Land Holdings Bhd. will hold the remaining 30 per cent of the venture.