Artist’s impression of Forest City.
Chinese developer Country Garden revealed that about 60 buyers at its Forest City project in Iskandar, Malaysia are looking to cancel their purchases, following efforts by Beijing to tighten capital controls on overseas investments, reported Reuters.
The measure saw Chinese buyers of overseas properties forfeit their purchases as their ability to pay instalments in foreign currencies has been affected.
With this, Country Garden has ceased selling the US$100 billion Forest City project in China. It also stopped accepting Chinese yuan as payment for the project.
The property developer said it has also stopped all travel-related support services for mainland Chinese buyers travelling to Forest City.
Country Garden, which sold more than 15,000 residential units in 2016, said it will now have a more diversified revenue from the mixed-use project through sales and rental of shopping malls, offices, a golf course and a hotel.
However, the company’s stance on penalties for cancellations has resulted in the formation of two online groups comprising a total of around 80 buyers, who are asking for refunds without penalties.
Country Garden said that buyers may face a penalty of 10 percent to 30 percent of deposits if they defaulted on payments or cancelled their purchase.