Chinese developer Country Garden has started promoting residential units at Forest City, a megaproject on four artificial islands in the narrow Johor Strait separating Malaysia and Singapore, even though the development is not yet built.
Mo Bin, the president of Country Garden Holdings, described the 14-square-kilometre scheme as a self-contained city.
“We will develop apartments, villas, schools, hospitals, an exhibition centre and a financial special administrative region to achieve city-industry integration,” he said a press conference in Singapore last month.
The project, with a price tag of $41bn (S$58.3bn) is billed as an “eco-city” with a light railway and roads located either above or below ground level to pedestrianise the entire urban space.
The project got under way in 2013, at which time it was intended to cover nearly 20 square kilometres. The scale was reduced following complaints from local citizens and the government of Singapore, which was concerned about the effect on its own coast of so much dredging.
Country Garden has so far spent $1.2bn on the first phase of the scheme.
Some property watchers have expressed the fear that Forest City may glut the market and lead to a fall in values
The contractor for the scheme, Singapore-based Teng Yue Construction, is presently engaged in bringing the islands into being, however the South China Morning Post reports that 700 units have already received presale permits, and that Country Garden plans to make apartments available on one of the islands in the first half of this year.
The average price of units is expected to be $280 per square foot, roughly twice the Malaysian average but relatively affordable for Singaporeans.
Some concerns have been raised about whether this price can be maintained. A little more than a year ago, the Financial Times reported that land prices have quadrupled along the coast of the south Malaysian state of Johor, which has fuelled a rush to build condominiums. Some property watchers have expressed the fear that Forest City may glut the market and lead to a fall in values.
The client for the project is a Country Garden Pacific View, joint venture between Country Garden and Esplanade Danga 88, with Country Garden holding a 60% stake. The largest shareholder in Esplanade is Ibrahim Ismail, the sultan of Johor. Country Garden notes on its website that the relationship has helped it achieve “smooth communication with governments”.
The project will be located in Iskandar Special Development Zone, which means that it is eligible for tax breaks, and according to Mr Bin, Country Garden is in talks with the government to allow duty-free shopping.
Top image: A promotional graphic from Forest City’s developers
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“Some property watchers have expressed the fear that Forest City may glut the market and lead to a fall in values” not to mention raising the sea water levels