The future of a $100 billion development on Malaysia’s coast is in doubt due to growing concerns over the financial stability of its largest backer, China’s Country Garden. The property giant has reported billions of dollars in losses — but insists that its showpiece Forest City project in Malaysia is safe.
With a vision of housing 700,000 people on four reclaimed islands between Malaysia and Singapore, this mega project is due for completion in 2035. But progress has been plagued by problems with only some 9,000 residents currently living here.
This international school on the southern tip of Malaysia is providing an American education to students in the middle of South East Asia. Opened in 2018, the school caters to around 160 pupils. Gregg Maloberti is the head of school.
Gregg Maloberti, Shattuck-St. Mary’s Forest City Head of School, said in the interview by VOA News:
“The great first wave of folks who came were all from China. During Covid that changed and we saw as much as 61% Korean students here. The school sits in Forest City, a development led by Chinese property giant Country Garden.”
Ezra Tanner, a student of the school said to the VOA News reporter:
“There has been a ton of students here and it’s made it very small and hard to run but it’s also kind of helped build a lot of strong community because this is just the people we know, it’s a very small group.”
The development had looked to attract wealthy Chinese buyers but in 2016 Beijing clamped down on the use of Chinese capital overseas. Then in 2020, Covid hit. Borders shut in China and Malaysia, further limiting Forest City’s sales. Country Garden, which owns a 60% stake in Forest City, is one of several developers hit by China’s property market crisis. The company is in financial peril and reported a $6.7 billion loss for the first half of this year, warning that it could default.
Tan Wee Tian, of KGV International Property Consultants said to VOA News:
“Whether you are already a resident, a buyer or you are a prospect looking at this project, the big question that on your mind would be that what’s going to happen in the pipeline for future projects, like you still have island 2, island 3 and island 4, so are they going to complete the project?”
But some who work here remain optimistic.
Head of the Internatonal School, Gregg Maloberti said to VOA:
“We are operating here as a school in Forest City, which is again once removed from Country Garden Holdings in China and listed in Hong Kong. So we are sort of insulated from whatever might happen in China.”
Country Garden insists that its projects in Malaysia are operating normally, and the Malaysian government has designated Forest City as a special financial zone to encourage investment. 28,000 residential units have been built so far, with over 80% sold. This luxury apartment is one of them, although with many properties bought as investments, there are concerns about low occupancy rates. For now, the sound of silence fills the air. This development was marketed as a living paradise, with a perfect climate and sea views. But as Country Garden’s financial troubles take their toll, it’s hard to see where the pathway ends for Forest City.
Source: VOA News in Johor, Malaysia
Story: Adam Hancock;
Camera: Yih Wen Chen.
