Country Garden stops free flights for Forest City ‘buyers’

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April 25, 2017 by iskandarinsider

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KUALA LUMPUR: Property developer Country Garden Holdings Co Ltd has stopped providing free flights to bring in potential buyers from mainland China to its sales gallery in Iskandar Malaysia, Johor, which previously formed part of its marketing campaign to lure investors to buy properties in itsCountry Garden Holdings Co Ltd development in the Strait of Johor.

“Since March 13, 2017, our sales galleries in China have ceased all travel-related support services for mainland Chinese travelling to Forest City. This means mainland Chinese buyers who are interested in the Forest City project will have to find their own way to our sales gallery in Iskandar Malaysia,” Country Garden said in a statement yesterday.

The Forest City development comprises four man-made islands sandwiched between Johor and Singapore, with a land area measuring 1,386ha, about three times the size of Sentosa Island.

The mammoth project, costing US$100 billion (RM443 billion), was in the limelight recently after Beijing introduced tighter rules to curb capital flight, which was estimated by the Institute of International Finance to have reached a record US$725 billion last year.

Last month, Country Garden closed its Forest City sales galleries in China as the government launched a crackdown on capital flight by banning its citizens from converting yuan into other currencies for overseas property purchases.

The project also drew harsh criticism from former premier Tun Dr Mahathir Mohamad, who slammed Chinese investments in the artificial islands, insisting that foreign ownership would undermine national sovereignty.

Regardless of current headwinds, Country Garden said yesterday it remains committed to developing Forest City.

“This is an ambitious project that will take about 20 years to materialise. As a project targeting international buyers and [a] global market, we are on track to build and deliver the residential and commercial units on schedule to our buyers and investors,” said the property developer, which reportedly enjoys close ties to the Sultan of Johor.

In 2016, Country Garden said it sold over 15,000 residential units. “In 2017, we expect more diversified revenue from sales and rental of a variety of properties such as offices, shopping malls, a new hotel and a golf course, in addition to residential properties,” Country Garden said.

To date, it said it has received inquiries from less than 60 buyers in China to cancel their bookings, adding that any cancellation after a sale and purchase agreement has been inked is deemed a breach of contract, which would result in a penalty ranging between 10% and 30% of the purchase price.

“We are currently in discussion with them (the 60 buyers),” Country Garden said.

It went on to say that it is in “positive discussions” with over 30 companies and investors to set up their regional hubs or to jointly develop and manage real estate assets in Forest City.

“These companies are in the tourism, education and healthcare sectors. Attracting businesses into Forest City paves the way for the formation of an economic hub in Iskandar Malaysia and we expect to make some announcements in the coming months,” Country Garden said.

Country Garden is the second-largest developer in China. It is also developing Central Park and Danga Bay — both in Johor — and Diamond City in Semenyih, Selangor.

Source:The Edge Markets

http://www.theedgemarkets.com/article/country-garden-stops-free-flights-forest-city-%E2%80%98buyers%E2%80%99


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