Malaysia’s $100-B city charming Asia’s wealthiest

By Maria Eloisa I. Calderon
Editor-at-Large

JOHOR, MALAYSIA — At the southern tip of the Malaysian peninsula — near its maritime border with Singapore — there lies a $100-billion reclaimed city that is attracting Asia’s wealthiest including from the Philippines.

The project is called Forest City, and the builder, Country Garden Holdings Co., a Chinese developer that is listed on Hong Kong’s Stock Exchange’s main board.

It is just a year-and-half old with a five-star hotel (Forest City Phoenix Hotel), a premium residential tower (Kylin Apartment), and a duty-free retail strip up and running so far, while the developer inaugurated over the weekend a football stadium and a factory (Industrial Building System) that manufactures ready-to-fix staircases, balconies and columns.

But once completed, Forest City will cover 2,000 hectares (20 square kilometers) of reclaimed islands “sitting on hard rock” after the Chinese builder fortified them 12 to 15 meters from surface to touch “hard rock”. Another 10 square kilometers of solid land that’s part of Johor state will house golf courses and the industrial zone.

The Chinese developer has been building all that at an “amazing speed” from the time it started reclamation work in 2015, Yu Runze, chief strategy officer of Country Garden Pacificview Sdn, told visiting Asian journalists during an Aug. 3 briefing here.

It’s all glitz, with the Crown Prince of Johor Tunku Ismail Idris Ibni Sultan Ibrahim, an advisor to Malaysia’s football association, attending the inauguration of Forest City’s stadium concept and the factory. But the company puts money where its mouth is: It is pumping another five billion Malaysian ringgit in Forest City this year, says Mr. Yu.

Country Garden expects more investments given that the masterplan for the green and smart city spanning a 20 year period. Its rights to the reclaimed area is “perpetual” and there’s support from Johor state given tax perks it enjoys. But the company said its doors are open to foreign investors, including from the Philippines.

“That will be very nice if they [Philippine conglomerates] want to invest in our project because for a city as I mentioned, all the service sector will be on the island… The manufacturing and the golf course will be on the main land,” Mr. Yu told a briefing.

“The manufacturing base offers lots of opportunities because the highway, the infrastructure here in Malaysia is a plus.”

A Philippine developer “came to this place to see it,” Mr. Yu said, without elaborating.

Country Garden was one of the companies invited by President Rodrigo R. Duterte to invest in the Philippines during the president’s lunch meeting with foreign businessmen in Hong Kong last May before he flew to Beijing for the “Belt and Road” summit.

The company’s main buyers were from China, but Beijing has imposed restrictions on local Chinese buying property overseas to curb capital outflows.

“Last year, there were 40 buses all loaded with Chinese. Now I don’t see them around,” said a staff from a chocolate store at Forest City’s duty free retail strip.

But Country Garden is trying to revitalize its sales strategy with plans to open more than eight sales offices across new markets including the Philippines, South Korea, Japan, Taiwan, Thailand and the United Arab Emirates, company officials said.

The company has a showroom in Jakarta, Malaysia and Singapore.

“Mostly middle- to high-income people come here. The buyers are Chinese, Malaysians, Singaporeans, and also from Taiwan, Hong Kong, Indonesia, Korea and Japan,” Vincent Woon, Country Garden Pacificview director of strategy department, said in an interview.

A salesman said he does expect Filipino buyers. Country Garden’s bungalows fetch as much as 19 million Malaysian ringgit for a 6,500-square foot ,six-bedroom affair. The smallest is 4,000 square feet in size priced at 10 million ringgit. The takeaway: It’s what you pay for a beachfront property with mangroves that will shield you from the climate change’s wrath.

There’s also a world-class school with an American partner, the Shattuck-St. Mary’s, expected to draw in an initial 200 students and later, 3,000 enrollees. Soon, there will be wellness health care apartments as the company has reserved 60 acres of land just for a medical city.

At Forest City, you can experience “the affordability of Malaysia and the prosperity of Singapore,” the company’s teaser says.

It’s a smart, green city, with no cars traveling on the surface as the highways and carpark are all underground.

Philippine developers can draw some inspiration from there, says Mr. Yu.

“I think no. 1, partnership is very, very important. If you go to a foreign country to do business, finding the right partner is very critical,” he said.

“No. 2, find a good lawyer. No. 3, find a good accountant.”

“Maybe another takeaway message is you work with the best brain in the world.”