Country Garden’s Malaysian mega development eyes global buyers
The project spanning a 14 square kilometres is looking to attract a wide array of buyers
Country Garden, China’s leading residential developer, said its mega reclamation project in south Malaysia’s Johor state will start apartment presales in the next six months and target global buyers.
The project, Forest City, comprising four man-made islands at the junction of Singapore and Malaysia, is the Chinese developer’s largest project overseas, with an expected total investment amounting to 250 billion yuan (HK$296 billion).
At its global press conference held in Singapore on Friday, Mo Bin, President of Country Garden Holdings, said the 14 square kilometre project was not simply a property project but a “city development project”.
“We will develop apartments, villas as well as schools, hospitals, exhibition centre, and a financial special administrative region to achieve city-industry integration,” Mo said, adding that the developer’s intention is to create a multi-layer eco-city, which has been designed to locate vehicular traffic and light rail transport away from ground level.
The project is in partnership with Kumpulan Prasarana Rakyat Johor, a Johor state investment arm, through a joint venture where Country Garden holds a 60 per cent stake.
While the huge project is still undergoing reclamation and infrastructure work, Country Garden said pre sales of apartments in one island would kick off in the first half of this year and the average price would be 1,200 Ringgit per square foot (HK$2,181 per sq ft).
“700 units have already received presale permits from the government,” said Jason Fu, regional head (Malaysia) of Country Garden.
When asked whether China’s slowdown and foreign exchange control tightening would affect its sales, the Country Garden’s chief strategy officer Jeff Lin said: “Forest City is targeting global buyers rather than Chinese investors.”
He added that more than 50 per cent of Country Garden’s project Danga Bay in Johor had been sold to buyers who are believed to be coming outside of China.
With the unique location, Country Garden hopes this project will attract large number of homebuyers from Singapore and boost the regional economy, he said.
“Johor to Singapore is just like Shenzhen to Hong Kong,” Mo said. “Shenzhen’s development has given us great inspiration.”
He expects affordable prices will make homes in Johor attractive to Singaporean buyers.
The relationship between Singapore and Malaysia is getting more connected as a high- speed rail link between Singapore and Kuala Lumpur via Jorhar is expected to begin construction this year.
Alan Tan Wing Wton, a director, ASEAN & South Asia at the Singapore Business Federation said he looked forward to Country Garden’s lead in encouraging Singapore companies to look overseas and invest in Malaysia.
Initiated in 2013, Country Garden’s Forest City project faced many challenges at the beginning. The proposed massive reclamation raised concerns about its environmental impact from both sides of the border and was once suspended in 2014.
The project restarted last January after obtained final approval from Malaysian environmental authorities after assessment.
As a part of Malaysia’s Iskandar Special Development Zone, the project enjoys beneficial policies including preferential tax rates.
Mo said the developer was in talk with the government to get approval to have duty-free shopping and landing visas in the area.
Country Garden plans to invest into the project in phases, having channelled 8 billion yuan in so far, Lin said.
“Our company has sufficient funds,” Lin said.