Malaysia Leaves $100 Billion Real Estate Project in Limbo
(Bloomberg) -- The fate of Country Garden Holdings Co.’s $100 billion project in southern Malaysia remains in limbo as Prime Minister Mahathir Mohamad said foreigners are welcome to invest, but they might not be allowed to stay for long in their new homes.
"They can buy the property, but we won’t give them a visa to come and live here," Mahathir said Tuesday, according to The Malay Mail.
It’s unclear how Mahathir could bar those who bought property at the Forest City project from applying for the Malaysia My Second Home program, which allows wealthy foreigners to live in the country on a long-stay visa. Chinese nationals are the largest group of participants in that scheme. Country Garden helps Forest City clients in applying for the program and covers their fees, according to its marketing website.
Last month, Mahathir set the Hong Kong-listed company’s shares tumbling by saying the project was off-limits to foreigners. Non-Malaysians will be blocked from buying Forest City property because it was “built for foreigners, not meant for Malaysians” with most local residents unable to afford it, he said.
His remarks left several parties scrambling. Within hours, the company said his comments weren’t in line with what he said to its chairman during a recent meeting. The following day, Housing Minister Zuraida Kamaruddin said a committee would be set up to “fine-tune” Mahathir’s statement, according to The New Straits Times. That same evening, the Prime Minister’s Office issued a statement to say foreigners buying property are bound by certain conditions, and that such purchases don’t guarantee automatic residency in the country. It didn’t refer to Forest City.
For now, the committee that includes representatives from the housing ministry, the finance ministry and the Johor state government are reviewing all the terms of the development. The group is expected to come up with a solid plan to resolve the matter once and for all.
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