Super city in sea draws catastrophe warning
A multi-billion-dollar new city near Singapore, planned by a Hong Kong- listed firm, is attracting interest from investors with promises of luxury living, but there are questions over its future owing to China's economic woes and warnings of environmental catastrophe.
Forest City, a US$42 billion (HK$326.6 billion) futuristic "eco-city" of high-rises and waterfront villas, will sit on four man-made islands on the Malaysian side of the Johor Strait just an hour from Singapore.
Offering 700,000 residential units as well as malls, international schools, hotels, convention venues and medical facilities on 1,370 hectares, the city will even have its own immigration center.
The venture is being developed by real-estate giant Country Garden (02007), headed by Yeung Kwok- keung, and a firm partly owned by Johor's powerful Sultan Ibrahim Iskandar with an eye on cashed-up Chinese buyers.
Officials say they have shifted 500 units in pre-selling already, although the development is not due to be completed until 2035. Sales executive Alex Lee said he had sold 10 properties in one sitting with a Chinese businessman, who paid cash.
Investors can pay anything from US$200,000 for a two-bedroom unit, up to US$1.6 million for a seaside villa.
By comparison, a mass market condominium in Singapore costs around US$740,000 - which in Forest City would buy a four-room seaside villa with a function hall, two parking lots and a large garden.
But some analysts question the project's long-term sales targets as China's economy struggles to break out of a growth slowdown that has seen expansion fall to 25-year lows, while authorities clamp down on a flight of cash from the country.
At the same time Standard & Poor's said it was cautious about Forest City after it downgraded Country Garden's long-term rating in March to BB from BB+, citing risks from its aggressive land acquisitions.
It called sales targets somewhat ambitious, given this is a new large-scale project and targets primarily mainland overseas buyers.
And even if the project is a success, campaigners say it could prove to be a disaster for the local ecology and fishermen who complain of dwindling catches.
While its website describes it as a "liveable eco-city," environmentalists say the dumping of sand to build the new city -- an estimated 162 million cubic meters -- could alter tides and destroy marine life.
Local activists say at most risk of destruction is Malaysia's largest intertidal seagrass meadow on Merambong shoal off Johor.
The reclamation has also ruffled feathers in Singapore, with the environment ministry saying it is carefully studying an impact assessment report provided by Malaysia and is seeking further clarifications.
Source: AGENCE FRANCE-PRESSE