Forest City, a development projected to house over 700,000 residents, businesses, shopping malls and even an international school, in Malaysia’s southern state of Johor, faced an uncertain future after a Mahathir-led Pakatan Harapan government took office in May’s 14th General Election: Dozens of large-scale projects have since gone under review, and many of them faced an untimely end on the chopping block after they were deemed too costly, or just plain unnecessary.
Prime Minister Mahathir has now weighed in, and confirmed that the project will continue, however, only under the auspices that foreigners will not be allowed to buy any residential units in the US$100 billion development located in the Iskandar economic zone.
“One thing is certain, that city that is going to be built cannot be sold to foreigners,” PM Mahathir told a news conference in Kuala Lumpur today.
“We are not going to give visas for people to come and live here,” he added. “Our objection is because it was built for foreigners, not built for Malaysians. Most Malaysians are unable to buy those flats.”
Leading up to his election, Mahathir often accused his predecessors of effectively selling off Malaysia to Chinese bidders. Having recently visited Beijing to discuss the future of certain plans, Dr Mahathir has already cancelled Chinese-backed oil and gas pipelines, as well as an east coast rail line that was to be built by them.
At the end of last year, over 70% of the properties that were purchased in Forest City were done so by Chinese buyers. Country Garden, the developers behind the project have yet to issue comment on the news.
Two years ago, Bloomberg wrote an in-depth report, detailing the plans for the project, where Country Garden would host plane loads of potential Chinese buyers flying over specifically to view the gold-platted features in their showrooms.
Once the tour was over, and buffet tables eaten dry, agents would aggressively encourage these investors to sign immediately. According to Country Garden, 50% would do just that, hoping that the Johor will become something of another Shenzen, the fishing village turned booming city across the waters from Hong Kong.
Many Malaysians have long expressed weariness over the large swaths of Chinese nationals buying up properties in Forest City.
Not only was the project based in the land reclamation of over 20 sq km from the sea, concerning many over the environmental damage that it would cause, as well as the economic impact it would have on local fishing, but there was also the flooding of properties on the market. Local real estate experienced a decline, something that many see being a direct cause by the boom of spaces in Forest City.
Projected to be five times the size of Central Park, no word yet on who will buy the rest of the unit, nor what of the foreign buyers who have already purchased their little piece of sea-drained paradise.
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