Dubbed the $100 billion ‘paradise’, the high-end real estate of a Southeast Asian country turned into a ghost town for just one reason.
The property is located in Johor Bahru, Malaysia, just north of Singapore. Country Garden, China’s largest real estate developer, is the developer of the project. Forest City has a large area spread over 1,740 hectares, 4 times the area of the principality of Monaco. Initially, 700,000 people were expected to live in this apartment complex.
But according to a 2019 report by Foreign Policy, as of 2019, only about 500 people live in buildings. Since then, Forest City’s population has grown to several thousand, but still less than 5% of the expected population, said one expert, who asked not to be named.
In early May, Insider’s Singapore office worker Marielle Descalsota flew to Malaysia to explore Forest City. While waiting at the airport in Johor Bahru, Marielle asked a few locals about the Forest City project. Many of them know nothing or vaguely about this real estate.
As the driver drove into the city, she was struck by the size of the area, like stepping into a sci-fi movie. The taxi entered the city, modern buildings appeared one after another. Dozens of luxury apartment buildings, galleries, shopping centers, international schools and 2 resorts are in the project.
But there was one thing Marielle couldn’t see that was a sign of life.
Marielle on a ride into a dream paradise called Forest City in Malaysia. Photo: Marielle Descalsota/Insider
When she arrived at the renovated area, she stopped by Forest City’s showroom. A large model of the entire building is placed in the center of the room. Many apartments are labeled “sold out”.
Real estate developer Country Garden says it has sold more than 20,000 units to date. It is unclear exactly how many units were built in Forest City.
Forest City model. Photo: Marielle Descalsota/Insider
Prices in the development have skyrocketed over the past few years. In 2017, the starting price of a home in Forest City was 740,864 Malaysian ringgit ($170,000).
Currently, condominiums in the development retail for 5 million Malaysian ringgit ($1.14 million). To put things in perspective, the median house price in Johor Bahru, where Forest City is located, is 619,633 Malaysian ringgit ($141,000).
Marielle then went to an apartment complex called Kylin Apartment Complex. The building looked big enough to hold hundreds of people, but the roads leading to the apartment building were deserted, just a few cars scattered.
Once again, Marielle had to exclaim that the construction works on a huge scale had almost no human presence.
An apartment complex in Forest City. Photo: Marielle Descalsota/Insider
Another employee, who asked not to be named, said there were about 20 people living in the complex. However, according to Malaysia Now’s 2022 report, many buildings are still regularly maintained and cleaned by workers and cleaners.
Most of the shops that Marielle saw in the complex were closed, empty, or abandoned. Chinese restaurant Shun De Gong and Singapore’s Venlis wedding venue are among the businesses that used to operate nearby.
An employee said stores have been closed or vacant for more than two years. Many product display spaces have turned into storage with stacked carbon crates.
Most of the shops in Forest City are closed. Photo: Marielle Descalsota/Insider
On the way, Marielle saw three restaurants open. Even so, she saw only a handful of people dining at those stores.
There are two resorts in Forest City. At the time of Marielle’s visit, the security guard at Kylin Apartment Complex said one of the two resorts had been closed for two years. In the background, dragonflies are laying eggs on the surface of the pool and the water seems to have changed color.
A swimming pool at the Forest City Marina Hotel. Photo: Marielle Descalsota/Insider
The stained doors of the Forest City Marina Hotel were locked, but there was still a guard guarding the lobby inside. One hotel remaining in the area is the Forest City Golf Hotel. Marielle spent 3 nights in a deluxe room there. Different from the sombre atmosphere of Forest City, this hotel is bustling with people coming in and out, most of them golf enthusiasts from the area.
Upon reaching the beach, Marielle saw an outdoor wedding venue. The trusses are planted with fresh flowers, creating accents for the stained benches and columns. She searched the internet for information on previously married couples here, but couldn’t find one.
Part of the mall. Photo: Marielle Descalsota/Insider
Marielle happened to come to the mall again, where the lights were dim and the smell of cigarettes wafted in the air. “No Smoking” signs were posted on the wall.
The shopping center in Forest City is huge, but with the exception of a café, there are hardly any shops in operation. Cigarette butts were scattered on the escalator and the floor.
The busiest store during Marielle’s entire trip was the duty-free store. Most people go to the store to buy alcohol and cigarettes. Customers are allowed to buy up to one case of beer. Forest City has checkpoints to make sure duty-free items don’t get out.
Duty free shop in Forest City. Photo: Marielle Descalsota/Insider
As dusk fell, several groups of people began to gather in the mall lobby and drink alcohol. Most of them are not from Forest City but from other parts of Malaysia.
But Forest City’s problems are not simply apathy among customers and visitors, but go deeper than that. While hailed as a “living paradise” and a “future green city”, some experts describe the area as a perilous ecological bomb.
Part of the Forest City was built on land reclaimed from the Strait of Johor. About 163 million cubic meters of sand were poured into the sea to build the city.
Some experts argue that the rapid pace of construction coupled with land reclamation is a dangerous combination.
Part of the map of Johor Bahru. Photo: Google Maps
Serina Rahman, a scientist and researcher in Malaysia, said that despite the use of advanced technologies for reclamation and construction, sand poured onto the seabed still takes longer to settle and stabilize. Some buildings have appeared cracks and road sections have subsided.
Country Garden told Marielle that the company had approved and issued the relevant permits and that the construction of the city was also “in compliance with laws and regulations”. The company added that it never ignores the issue of natural landscapes, environmental protection and CSR (corporate social responsibility) initiatives.
Some locals and experts say the construction of Forest City has taken a special toll on fishermen living in nearby fishing villages. To dig deeper, Marielle goes to a fishing village and meets Serina, a scientist whose research focuses on Forest City’s influence on the fishing village.
A seafood market in a fishing village. Photo: Marielle Descalsota/Insider
In a 2017 report, Serina documented the challenges that construction projects like Forest City have on the livelihoods of fishermen. Serina writes that some fishermen are not licensed by the Ministry of Fisheries. The unlicensed fishermen are then excluded from the subsidy programs and are not eligible for compensation from the developers.
The pattern of land reclamation in the Strait of Johor has led to a drastic reduction in the amount of fish that local fishermen can catch. Serina said it is difficult for fishermen to catch about 20kg of fish when they go out to sea. Their boats are small, but they have to go farther from the shore, making the fishermen’s jobs increasingly dangerous. A local resident lamented that they would die before they caught the fish.
According to a 2018 report from environmental site Mongabay, Country Garden has paid $25 million in compensation to about 250 fishermen because of their declining catches.
Forest City at night. Photo: Marielle Descalsota/Insider
When it was dark, the surroundings of the development were quiet. The skyscrapers were still dark with a few apartments lit. Muhammad Najib Razali, professor of real estate at the Malaysian University of Technology, has conducted extensive research on urban planning and real estate in Johor Bahru. Marielle met Najib in Forest City to find out why the condos were unoccupied.
The main reason, he says, is in expensive apartments. Locals cannot afford them. The average annual salary in Malaysia is 24,744 Malaysian ringgit (about 5,651 USD) in 2020.
For foreign buyers, an obstacle exists that prevents them from buying a home. “We talked to the developer and they said that the main target customers are Singaporeans and foreigners,” Mr. Najib said.
But Singaporeans were dissuaded because of many failed projects in Malaysia. In 2021, the whole country has 79 abandoned housing projects. Although Forest City is still in development, its ghost town status makes it impossible for the project to attract global buyers.
“These condos have failed to attract Singaporeans, who like to come see and see the property firsthand before buying,” he said.
For its part, Country Garden believes the project will thrive in the future, although that may not be the near future. Country Garden said: “As economic activity resumes and the travel ban is lifted, we are looking forward to Forest City’s thriving again. This process will certainly take some time and no immediate effect”.
Source: BIEN
at Blogtuan.info – Source: cafebiz.vn – Read the original article here
