Malaysia’s Country Garden Forest City, the US$100-billion ‘ghost town’ caught up in China property giant’s woes

Another deadline looms next week over an unpaid multimillion dollar interest payment that again leaves it at risk of default.

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Malaysia’s China-linked multibillion-dollar ghost town project stalled by Covid and capital curbs

Malaysia’s China-linked multibillion-dollar ghost town project stalled by Covid and capital curbs

“I hope Country Garden can overcome their financial difficulties,” said 29-year-old Zhao Bojian from Chinese province Henan, who bought one of 26,000 Forest City units for around US$430,000 five years ago.

“If nobody comes to Forest City, we cannot do business here.”

Construction workers chip away at the island city by day while an eerie silence falls over its deserted four-lane highway at night.

Only a small number of lights shine from windows by evening across the project’s more than two dozen high-rise towers.

Below those sit rows of closed shopfronts, some with court documents stuck to doors demanding outstanding payments. Inside, rubbish is strewn across the floors.

Many buyers do not live in the artificial city, a security officer said, and instead stash their money as absent owners.

Model sculptures of the completed city’s four artificial islands – far from its current state – sit in the lobby of a sales showroom to attract potential buyers guided by Mandarin, Malay and English road signs.

Previous governments have opposed residency for expat investors, criticising the project as built only for foreigners.

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Last week, he announced the creation of a “special financial zone” and perks including a special income tax rate and multiple entry visas.

Observers say Forest City faces an uphill battle regardless.

“The liquidity pressure could have an impact on their capability to complete overseas housing projects,” said Bernard Aw, chief Asia-Pacific economist at credit insurance firm Coface.

A three-hour drive from capital Kuala Lumpur, the city attracts visitors who want to catch a glimpse of the space-age towers or buy duty-free alcohol.

“Everyone comes here for the liquor,” said Singapore-based technician Denish Raj Ravindaran.

“I will not stay here, it is a ghost town. The road is dark and dangerous and there are no street lights.”

Much of the activity is foreign workers – many from Nepal or Bangladesh – maintaining the city’s bushes, sweeping its roads or guarding its towers.

An artificial sand beach littered with beer cans where families picnic under coconut trees also bears a sign warning would-be swimmers about crocodiles.

At one 45-storey tower, an official says only two floors are occupied while the rest are for sale.

As Country Garden fights for its survival, drastic efforts are likely be needed – from both Beijing and Kuala Lumpur – to get Forest City on its feet.

“I came here for a holiday after seeing TikTok videos,” said retail clerk Nursziwah Zamri, 30, from Malacca state.

“If you ask me if I would live here, the answer is no.”