By Paloma Almoguera

Iskandar Puteri, Malaysia, Dec 19 (EFE).- Rising from the trees just after crossing the strait between Singapore and Malaysia, Forest City is an imposing sight, the tall apartment blocks clashing with the surrounding landscape.

These homes are part of the most ambitious foreign project in the country by debt-ridden Chinese property developer Country Garden.

"Welcome Home" reads the sign at the gates of this city in the southern Malaysian state of Johor, which was built from scratch on land that was reclaimed from the sea, a mere 15 kilometers (9.3 miles) from the border with Singapore.

Construction began in 2015 - 60% of the project was funded by Country Garden, once China's largest real estate company which is now in debt, while 40% was put up by a local Malaysian firm - with the aim of housing 700,000 residents across four artificial islands.

Nearly a decade later, the city occupies part of a single island and, according to Xi Yue, Country Garden's brand manager, is home to some 10,000 people.

"Of the 28,000 existing homes, we have sold 80%," he tells EFE from the Forest City showroom.

"Tropical life can be enjoyed right here, surrounded by facilities," Xi says.

"We have an international school, a mall - as yet unopened -, a shopping street, a beach and a water park."

Despite Xi's optimistic outlook, the city looks dreary.

On a Thursday morning, most of its few shops are closed, its streets deserted except for security personnel or cleaners tending to its image as a grotesque holiday resort: the water park empty and the beach populated by a boarded-up beach bar and a "no-swimming" sign warning of crocodiles.

The only people are a Malaysian couple relaxing on a couple of concrete deckchairs, drinking beer.

"We live half an hour away and we come here sometimes, on weekends it's more crowded... Some people stay at the hotel," Sunderi, 33, tells EFE, making no secret of the reason for his visit: its duty free shops, which are very appealing in a country with high taxes on alcohol.

"I like to come here for a while, but I wouldn't live here.... The roads are very dark at night," he says.

ISOLATION, DEBT

Forest City, which is administratively under Iskandar Puteri, is about half an hour's drive from the state capital, Johor Bahru, and although Singapore is visible from the shore, the crossing can take about three hours due to traffic jams at border control.

"At first there were no buses, I had to fight hard to get them chartered (one line to the Singapore crossing and another to Johor Bahru)," Wang Ying, a 71-year-old Beijing woman who moved to Forest City with her husband in May to be closer to their only son, who lives in Singapore, tells EFE.

The septuagenarian and her husband, Yu Hong, bought a 60-square-meter flat for 1 million yuan (about $190,000).

While it is six times less than they would have paid for a similar flat in wealthy Singapore, the cost is unaffordable to most in Malaysia, where the average monthly salary is about 700 dollars.

Wang has just finished her morning walk, a routine she says keeps her fit and busy, as she says they hardly have any neighbors.

"At least I have him," she says, pointing to her husband, who is much less talkative.

The sense of isolation has not been helped by the many problems the project has faced since its inception: administrative obstacles, the Covid-19 pandemic and Beijing's restrictions on foreign investment.

Intended largely for Chinese nationals looking for a "tropical" lifestyle, and although it initially attracted numerous buyers, interest soon waned, and now a question mark looms over what will happen if Country Garden goes bankrupt.

The developer was first declared in default at the end of October, when it admitted it could not meet its nearly $16.5 billion of offshore debt in time after coming under "significant pressure" on sales, which fell 44% year-on-year in the first three quarters.

SITUATION IN CHINA & FUTURE PLANS

The situation in Forest City is not very different from that of other similar so-called "ghost towns" in China, demand for which was greatly overestimated.

The debts racked up by the large property developers behind these construction projects are now leading to fears that the bubble is about to burst.

In the case of Forest City, the Malaysian government itself has come to the rescue: the prime minister, Anwar Ibrahim, designated the area as a special financial zone in August, with tax incentives and flexible visas, in the hopes of attracting companies being forced out of Singapore by the city-state's high prices.

For the moment, companies like Netflix have shown an interest in Forest City as a filming location, while the city has become a recreational spot for Malaysians and Singaporeans, as attested to by the plates littering the beach from a nearby fried chicken chain.

"People come mainly to spend the day," says a waiter, recounting the weekend traffic to the city where, according to its signs, "happiness never ends", even if its visitors prefer to leave before sundown. EFE

© 2023 EFE News Services (U.S.) Inc., source EFE Ingles