Forest City

[rotikok]

Sometimes I really find you 牛皮灯笼加黑漆 - 永运点不明。
You see, the Chinese developers come all the way here, literally 漂洋过海， 劳师动众 for what, obviously to make big money!
If coming here can only make a little money or worse just break even, why bother!
So, can they make big money just selling 20,000 units when their initial intention and calculation were many times higher?

The example you used to compare prices is totally flawed.
First, you use some development on the mainland to compare with some already near completed or near completion.
Secondly, you don't know the current construction prices.
According to most current study, high rise luxurious condos cost RM3,000 to 4,400/sq m to construct, note, just to construct only!
And based on this prices, the profit margin is only 12.5%!

View attachment 30106
See the footnote on all the items exclusive in the cost.

You also forgot that those development you mentioned are all build with the existing infrastructure in place - roads system with street lightings, sewerage system, drainage system, power grids, etc. and all the developer needs to do is to connect to the existing system.
For FC, which is an inclusive development, the developer is responsible to construct and maybe provide complete maintenance too, for most of the infrastructure works instead of just a connection like the others.
So, it is not just the construction cost per unit that you should be looking at, you need to add in other costs too and they are not cheap.
Also, if FC depends on the JKR to construct the roads leading to the island, they may have to wait at least 4 or 5 years later, if lucky enough.
Again, I emphasis on the "leverage and economy of scale" factor.
The developer really need to sell much more than that 20,000 units in order to off set the initial reclamation and infrastructure cost.

Haha finally! You are giving out single piece of evidence to support my point, and prove that you have very poor grasp on conversion rate and fail your basic calculation.

Ok, very simple, previous post ady explained, now explain deeper again.. Cost got variable cost and fix cost, agree? Fix cost can be those road, reclaimed islands, basic infra, advertising fees etc. The more condo you build, those cost rather fixed, unmove or increased marginally.

Variable cost will be those construction price. The more you build each unit, the higher the cost will be. So we can work out our margin accordingly based on construction price and the price we sold for each unit.


*1.Since you are arguing 20K units is not enough. So we use 20K units, and assume all sold out, with certain degree of certainty to get the money after finish construction.

*2. What is the average size to represent those 20K units, so as to simplify our calculation. 1000sqf, fair?
Meanwhile, the condominium units and high-rise coastal residences on Island 1 have already been launched for sale in Singapore, China and Malaysia. Unit sizes range from 753 sq ft to 1,862 sq ft, with prices averaging around RM1,200 psf (S$400 psf). from the article
http://www.propertyguru.com.sg/prop...016/johors-forest-city-given-duty-free-status

Got studio, 1,2,3 bedder room, diff size, average up abit, btw 700-1800 sqf, i choose 1000sqf (more likely to be a 2 bedder), agree?

*3. Price? RM1200 is the latest phase price....we discount a bit for you, so that you wont lose face too badly and blame us using too high selling price.
http://www.freemalaysiatoday.com/ca...1/some-china-forest-city-purchasers-in-limbo/
She paid RM63,500 with her bank card as a 10 per cent down payment on a 59 square metre apartment. from article
-->RM635000 for 100% payment for her 59 sqm apartment. She paid RM 10762 sqm
10.7sqf=1sqm
Has to highlight this, so that can slap your face again when calculating the cost based on the evidence you gave.

Work out, she bought a small apartment at 631 sqf for RM635000----->RM1005 psf (RM 10762 per sqm)...still too high lehh...give you even more discount, I give you selling price RM 800 psf for all 20K units la, fair?

*4 Cost? high rise luxurious condos cost RM3,000 to 4,400/sq m to construct, note, just to construct only!
This is what you gave. Ok la, fair to you, i use RM4400/sqm, cost at the higher end. Convert= RM411 psf.

Now can work out the margin for each sqf/sqm liao? You gave 12.5%

Selling price RM 800 psf, cost RM 411 psf= Each sqm or sqf they sold, their margin is at 48.6%....and please remember, I already lower down my selling price, higher up the cost based on the evidence you gave.

Ok now 20K units, total 1000sqf on average @ RM 411psf on average. =That will be total net earning of RM 8.22B that can be used to pay for the fix cost.... remember last post you said 1.9B for land reclaimation? RM 8B net earning not enough to cover? need to sell until 30K - 40K baru can cover? 20K units sold, doesnt have sufficient economic of scale?

I know, the reason why your 牛皮灯笼加黑漆 - 永运点不明, is because you are not even willing to work out your calculation to prove your point....wait, you did work out 12.5%, bravo!

Ok please try to argue back with calculation, if you agree with me, please thanks me for pointing out that you are wrong, thanks for me to teach you simple calculation. I spend my time to type out the whole thing just simply because you are unwilling to even to use your brain. You actually already giving out evidence that prove my point, yet still giving out a wrong answer, tell me, you got use brain to think ma?

 

[rotikok]

Dear snowbird

You sound like someone whom already vested in this project and assume it will be a "happy ending".

Since you are vested; you will not be able to accept the picture what people not vested see.

With all this bad publicity; the developer will have problem selling their units in the future.

As I have said earlier; the warning go out to people whom are looking to buy into JB properties. For those already bought into the "developer dream". Other than praying it will succeed; nothing else they can do.

Investment do not have to be so complicated. I buy a property; as long I got my unit that is the end of the story. (I bought Astaka Padu and Sky 88)

In forest city case; if you lucky enough to get your unit; you may be living in a ghost town. Why go thru such trouble when you money can buy better located project in the heart of JB? This is the question only you will know.

Good luck.

I dont know much about snowbird, but I do have vested interest...but not in FC itself, is the land surrounding it. If it meant to be a ghost town, still acceptable bcoz ppl can stay, unit price will be bad, but land price still got chance. If end up as a abandon project, then i have to be very alert to runaway any risky play.

The root argument btw me and snowbird is that, whether we agree, FC already reach its economic of scale that it is much needed to at least say, this project is already a no way back, cannot be abandon project. For me, 10K units is already a very safety net..but snowbird think it needs to be 30-40K units, and I deeply challenge such idea. Actually my points, all the while is consistent. Snowbird first unable to understand what i had written, second unable to come out with his own bird calculation....n keep challenging me, even come out with data that support my point and say im wrong....hahahaha. :kma:

 

[snowbird]

Sit tight, so the 20,000 so called Mainland buyers are actually not buyers as yet but just paid a booking fees.
I was already suspicious as how can they sell properties in China to individuals without them first getting the prior state approval, a requirement for foreigners.
Which means there is so far no State approvals issued and no signing of proper binding S&P agreement, no bank loan approvals yet.
The Johor Mentri Besar just confirmed this!

“Forest City is still under construction. There are no registered buyers but only bookings,” Johor Menteri Besar Mohamed Khaled Nordin told reporters after opening the SK Taman Cendana Parent-Teacher Association (PTA) annual general meeting here today (11.03.2017)

 

[rotikok]

Sit tight, so the 20,000 so called Mainland buyers are actually not buyers as yet but just paid a booking fees.
I was already suspicious as how can they sell properties in China to individuals without them first getting the prior state approval, a requirement for foreigners.
Which means there is so far no State approvals issued and no signing of proper binding S&P agreement, no bank loan approvals yet.
The Johor Mentri Besar just confirmed this!

“Forest City is still under construction. There are no registered buyers but only bookings,” Johor Menteri Besar Mohamed Khaled Nordin told reporters after opening the SK Taman Cendana Parent-Teacher Association (PTA) annual general meeting here today (11.03.2017)

Haha, Im so happy with your poor understanding of law, this reply i can shoot you gao gao again. At the same time, i grab your argument method: google key word, saw a sentence or two points that you think stand on your sides. Then without much deeper understanding it, combine with other points, make up your own story.

Do you mean when those chinese come and buy malaysia ppty, they need to get China gov approval to buy the foreign unit, baru they can buy it? First, think about it, since when buying a foreign ppty, need your local state gov for approval?

I got wash money out before. For example, when i buy australia ppty, malaysia gov has no knowledge about my oversea asset.

Then what state approval has anything to do with "signing of proper binding S&P agreement". The oversea ppty that you purchased, is under that country jurisdiction, hey, this is very basic law that any kindergarten kid will know. S&P that you signed, are legal binding agreement that govern under that country law....do you expect FC S&P agreement is written in mandarin, govern by China law??? Prove: FC is freehold...china law no such thing as freehold.

So your whole argument is flawed, China law do not extend to the point where their citizen bought oversea asset, and want those asset govern by China law...if china do so, this is sovereignty rights violation.

You blur blur mix it with getting approval to send out money from China, to approval to buy overseas ppty. China can denial to grant their ppl to send out money from china, this is within their legal rights...but china ppl do not need to get state approval to buy oversea ppty, simply bcoz china has nothing to do with overseas ppty, no approval needed.

Ouch!!! Big slap on face bcoz you do not know simple law.


Ok, i think a lot of my previous points has cover all the possibilities, i dont think you can come out with your story and make sensible argument.

No bank approval yet
In my previous post, I already said, malaysia bank do not involve much. Later what i discover is, actually obtaining bank in china for overseas mortgage approval is actually much harder. Those 20K buyers...i would suspect a big portion of them are actually very cash rich, or they able to obtain loan from overseas financial institution esp from hongkong to support the purchase.

http://hn.meifang.com/uploadfile/2016/0412/20160412023523498.jpg

See, the downpayment for the booking fees is 10% of the total ppty price.

So I do not worry about what registered buyer or merely paying booking fees means. In my previous post I had already mention, getting booking fees back is very hard, or CG unwilling to release those buyers. In Malaysia law, paying 10% is when you sign S&P. I dont know what Khaled (again is malaysia minister, rmb my comment about malaysian minister?) meant by saying "just pay (10%) booking fees" and yet still not registered buyers. If people just come and book, without any money pay, tomorrow I go CG, the booking sale result can instantly gone up to 100K units, no problem if booking no need to pay any money.

So eventually the final question will be: among 20K units sold, and assume we allow easy give up and willing to return a refund. How many % will remain?

Rmb this question that i asked in my past previous post? You said 50%, the whole thing condemn....really?

50% give up, still got 10K units need to be built.... so the net earning will still be RM 4B..... still a very viable project even FC faced 50% demand decreased.

The only way to make you point valid to prove that FC will be a failure abandon project, is to prove that it will be 0 sales, everyone will runaway from the project....you tried, using your law from Mars. But..please back to earth, the project is still alive.

IF agree what i said, like my previous post request, no need to apologize...just thank me to point out your error, together with this post to reply your logical flaw.

 

[snowbird]

Haha finally! You are giving out single piece of evidence to support my point, and prove that you have very poor grasp on conversion rate and fail your basic calculation.

Ok, very simple, previous post ady explained, now explain deeper again.. Cost got variable cost and fix cost, agree? Fix cost can be those road, reclaimed islands, basic infra, advertising fees etc. The more condo you build, those cost rather fixed, unmove or increased marginally.

Variable cost will be those construction price. The more you build each unit, the higher the cost will be. So we can work out our margin accordingly based on construction price and the price we sold for each unit.


*1.Since you are arguing 20K units is not enough. So we use 20K units, and assume all sold out, with certain degree of certainty to get the money after finish construction.

*2. What is the average size to represent those 20K units, so as to simplify our calculation. 1000sqf, fair?
Meanwhile, the condominium units and high-rise coastal residences on Island 1 have already been launched for sale in Singapore, China and Malaysia. Unit sizes range from 753 sq ft to 1,862 sq ft, with prices averaging around RM1,200 psf (S$400 psf). from the article
http://www.propertyguru.com.sg/prop...016/johors-forest-city-given-duty-free-status

Got studio, 1,2,3 bedder room, diff size, average up abit, btw 700-1800 sqf, i choose 1000sqf (more likely to be a 2 bedder), agree?

*3. Price? RM1200 is the latest phase price....we discount a bit for you, so that you wont lose face too badly and blame us using too high selling price.
http://www.freemalaysiatoday.com/ca...1/some-china-forest-city-purchasers-in-limbo/
She paid RM63,500 with her bank card as a 10 per cent down payment on a 59 square metre apartment. from article
-->RM635000 for 100% payment for her 59 sqm apartment. She paid RM 10762 sqm
10.7sqf=1sqm
Has to highlight this, so that can slap your face again when calculating the cost based on the evidence you gave.

Work out, she bought a small apartment at 631 sqf for RM635000----->RM1005 psf (RM 10762 per sqm)...still too high lehh...give you even more discount, I give you selling price RM 800 psf for all 20K units la, fair?

*4 Cost? high rise luxurious condos cost RM3,000 to 4,400/sq m to construct, note, just to construct only!
This is what you gave. Ok la, fair to you, i use RM4400/sqm, cost at the higher end. Convert= RM411 psf.

Now can work out the margin for each sqf/sqm liao? You gave 12.5%

Selling price RM 800 psf, cost RM 411 psf= Each sqm or sqf they sold, their margin is at 48.6%....and please remember, I already lower down my selling price, higher up the cost based on the evidence you gave.

Ok now 20K units, total 1000sqf on average @ RM 411psf on average. =That will be total net earning of RM 8.22B that can be used to pay for the fix cost.... remember last post you said 1.9B for land reclaimation? RM 8B net earning not enough to cover? need to sell until 30K - 40K baru can cover? 20K units sold, doesnt have sufficient economic of scale?

I know, the reason why your 牛皮灯笼加黑漆 - 永运点不明, is because you are not even willing to work out your calculation to prove your point....wait, you did work out 12.5%, bravo!

Ok please try to argue back with calculation, if you agree with me, please thanks me for pointing out that you are wrong, thanks for me to teach you simple calculation. I spend my time to type out the whole thing just simply because you are unwilling to even to use your brain. You actually already giving out evidence that prove my point, yet still giving out a wrong answer, tell me, you got use brain to think ma?

Now I know why you are always 牛皮灯笼加黑漆 - 永运点不明, either you can't read or you don't understand simple English!
I said very clearly that :
According to most current study, high rise luxurious condos cost RM3,000 to 4,400/sq m to construct, note, just to construct only!
I highlight : just to construct only!
This means FC, the developer has to pay the contractor that amount of money to construct every square meter of built-in apartment space!
And with this price, the contractor only get a profit margin of 12.5%, not the developer, understand!!!
And this is provided by the same study.



Now, back to your stupid and juvenile argument which I need to correct again and again.
Total units sold as reported : 20,000 units.
Since its a mixture of apartment sizes from few hundred sq ft to 1,800 sq ft, I'll use an average of 1,000ft2 /unit or approx. 93m2
So, to construct 1 unit of apartment of about 93m2 = RM4,000 X 93 = RM372,000.
20,000 units = 20,000 X 93 X 4,000 = RM7,440,000,000 or about RM 7.4 billions.
And this is only the construction cost in which FC has to pay the main contractor to build 20,000 units.

And then it's the total units on offer against total units sold.
The CG in Danga Bay, after 3 years in the market, only about 80% sold as reported by Forbes Custom in Dec 2016.
So, for FC compare to CG Danga bay which is only just in the market and so remote, how many percent is achievable to date?
The selected units will be all over this Phase so FC has to build all units even only 20,000 unit were taken up.
Honestly, I don't have this figure but with reference to Danga Bay, I'll assume 50% to 60% sold.
Which then means FC has to build all the units which is as much as 35,000 to 40,000 of them in this Phase.
So, need to add building cost of unsold units - 15,000 units X 93m2 X RM4,000 = RM5,580,000,000 or RM5.58 billions.

Then there is this underground carpark which FC had been boasting about.
The about costing is not including underground or multi-storey carpark.
20,000 units would required min.20,000 carpark lots plus at least 10% visitor lots and extra lots for bigger units, so total 22,000 parking lots.
While one parking lot is approx. 4.8 x 2.4m (11.5m2) , provision for 1 lot within a carpark is about double a lot area to include parking aisle and driveway, etc.
22,000 parking lots = 22,000 X 23.04m2 = 506,000m2
Based on RM2,500/m2 = 506,000 X 2,5000 = RM1,265,000,000 or RM1.265 billions.

So, the building cost alone, including the reclamation works will be 7.4 + 5.58 + 1.265 + 1.07 billions = RM15.315 billions.

I've already mention before the infrastructure cost like roads on the mainland leading to the FC site and road system within the island, sewerage system, power station etc. which is not included.
Don't forget that FC is on an island which means they will also need to build pier or jetty for both human and cars on the mainland and on the islands - another major cost need to be added.
Then you have the provision of ferry and shuttle service which is long term.
So, with all this projected cost and then only 20,000 units sold and all sales halted in China, is the project still viable?
Of course, a profit of a few million RM is still a profit but my point is big business with high business cost and after all the 漂洋过海， 劳师动众, 开山瑱海，划算吗？
And now its announced by the Johor MB that so far, only booking fees was collected so stopping the project or shelving it till a later date may be a good alternative.
Now, hope this is clear enough for you to understand.

Another important issue.
Country Garden has been aggressively expanding in the past two years that by the end of the first half of 2016 the company’s debt-to-equity ratio was as high as 94 per cent!
Which also means the longer they take to realize their projected profit, the financial status will get more desperate.
And then the sudden resignation of the CFO in Jan this year after only 3 years in the job which he took over from a CFO who also suddenly resign.
Looks like maybe something fishy is going on.

 

[rotikok]

Now I know why you are always 牛皮灯笼加黑漆 - 永运点不明, either you can't read or you don't understand simple English!
I said very clearly that :
According to most current study, high rise luxurious condos cost RM3,000 to 4,400/sq m to construct, note, just to construct only!
I highlight : just to construct only!
This means FC, the developer has to pay the contractor that amount of money to construct every square meter of built-in apartment space!
And with this price, the contractor only get a profit margin of 12.5%, not the developer, understand!!!
And this is provided by the same study.

View attachment 30115

Now, back to your stupid and juvenile argument which I need to correct again and again.
Total units sold as reported : 20,000 units.
Since its a mixture of apartment sizes from few hundred sq ft to 1,800 sq ft, I'll use an average of 1,000ft2 /unit or approx. 93m2
So, to construct 1 unit of apartment of about 93m2 = RM4,000 X 93 = RM372,000.
20,000 units = 20,000 X 93 X 4,000 = RM7,440,000,000 or about RM 7.4 billions.
And this is only the construction cost in which FC has to pay the main contractor to build 20,000 units.

And then it's the total units on offer against total units sold.
The CG in Danga Bay, after 3 years in the market, only about 80% sold as reported by Forbes Custom in Dec 2016.
So, for FC compare to CG Danga bay which is only just in the market and so remote, how many percent is achievable to date?
The selected units will be all over this Phase so FC has to build all units even only 20,000 unit were taken up.
Honestly, I don't have this figure but with reference to Danga Bay, I'll assume 50% to 60% sold.
Which then means FC has to build all the units which is as much as 35,000 to 40,000 of them in this Phase.
So, need to add building cost of unsold units - 15,000 units X 93m2 X RM4,000 = RM5,580,000,000 or RM5.58 billions.

Then there is this underground carpark which FC had been boasting about.
The about costing is not including underground or multi-storey carpark.
20,000 units would required min.20,000 carpark lots plus at least 10% visitor lots and extra lots for bigger units, so total 22,000 parking lots.
While one parking lot is approx. 4.8 x 2.4m (11.5m2) , provision for 1 lot within a carpark is about double a lot area to include parking aisle and driveway, etc.
22,000 parking lots = 22,000 X 23.04m2 = 506,000m2
Based on RM2,500/m2 = 506,000 X 2,5000 = RM1,265,000,000 or RM1.265 billions.

So, the building cost alone, including the reclamation works will be 7.4 + 5.58 + 1.265 + 1.07 billions = RM15.315 billions.

I've already mention before the infrastructure cost like roads on the mainland leading to the FC site and road system within the island, sewerage system, power station etc. which is not included.
Don't forget that FC is on an island which means they will also need to build pier or jetty for both human and cars on the mainland and on the islands - another major cost need to be added.
Then you have the provision of ferry and shuttle service which is long term.
So, with all this projected cost and then only 20,000 units sold and all sales halted in China, is the project still viable?
Of course, a profit of a few million RM is still a profit but my point is big business with high business cost and after all the 漂洋过海， 劳师动众, 开山瑱海，划算吗？
And now its announced by the Johor MB that so far, only booking fees was collected so stopping the project or shelving it till a later date may be a good alternative.
Now, hope this is clear enough for you to understand.

Another important issue.
Country Garden has been aggressively expanding in the past two years that by the end of the first half of 2016 the company’s debt-to-equity ratio was as high as 94 per cent!
Which also means the longer they take to realize their projected profit, the financial status will get more desperate.
And then the sudden resignation of the CFO in Jan this year after only 3 years in the job which he took over from a CFO who also suddenly resign.
Looks like maybe something fishy is going on.

Walau...i thought i gave you a nice slap on face, when in fact 12.5% is actually contractor margin...i dont understand why you even bother to quote such unmeaningful data, do contractor margin explain viability of FC? if totally irrelevant, why you even bother to quote? I have to say, nice shun! Also you had very clever way to shun your shortcoming by not calculating out the income side and only calculating out the cost, what do you expect me to understand from your biased calculation?

Ok before proceed any further, lets slap your face first on the other side:
Honestly, I don't have this figure but with reference to Danga Bay, I'll assume 50% to 60% sold.
Which then means FC has to build all the units which is as much as 35,000 to 40,000 of them in this Phase.
So, need to add building cost of unsold units - 15,000 units X 93m2 X RM4,000 = RM5,580,000,000 or RM5.58 billions.


See, i always say you like to make up story. I said before in my previous post, amount of units build depend on demand sides. You want to make up story, easiest way is to assume they are going to build all 30K-40K units....how do you even get to know that they are going to build 30K-40K units?????

You know the reason why you do not know the % sold? because the supply is not fixed, and when supply is not fixed, no way you can know % sold.
碧桂园主席及执行董事杨国强说，马来西亚的森林城市项目，碧桂园采取的是“以销定产”模式，有能力可以做好。
http://www.sinchew.com.my/node/1626733/碧桂园主席：以销定产‧森林城市销售“微不足道”

So you come out with parking lots cost....this i accept, at least this is variable cost. Reclamation cost, I will rather put it in fix cost category, also infrastructure cost, pier or jetty...are all fix cost...agree? or need me to explain why i put it in fix cost? you know the diff?

I will omit provision of ferry and shuttle service from cost calculation....if such service not profitable, they can just stop it and no long term burdening cost that they need to worry about.

Now we do the maths again
20K units sold will earn them RM 16B (hey how come you do not calculate out such figure?)
Minus variable cost: 20K units cost RM 7.4B (figure given by you) + parking lot cost RM 1.265 (no building cost of unsold units bcoz they 以销定产, no reclaim land cost bcoz that is fix cost)

They will earn RM 7.335B ringgit, to pay for all the fix cost （total cost for land to reclaim，infra, pier, jetty, fast road lane to ciq etc etc). Not enough? You still think stopping the project or shelving it till a later date may be a good alternative?


As for the CG company current company financial health being, i will refrain from putting out comment first until I finish the company reports. Suddenly you mention about such issue trigger my curiosity about other china major construction company financial health being. Remember in my previous post, I said im not fixed on my stance, one of the reason that i may change my stance is when china ppty bubble happened.

As for the resignation of the CFO, i do not want to put out a conspiracy guess la. 3 years resign...very common in corporate world. If he found any wrong doing, he should report to the authority, resign will not help. If later found out such unacceptable act by the authority, they will trace back who is the CFO back then and charge him (together with anyone involved) no matter where he go, resign do not mean he is safe from his involvement.
If let say he resign bcoz he is guilty of making the company going bankrupt, this also no need to resign, in real world, a lot of CFO that make company gone bankrupt, do not resign. Not their responsibility as long as they do their own due diligence, and they stay on can continue to take gaji. I dont know what fishy is going on, perhaps you can enlighten me.

Lastly, now i want you to apology for your "your stupid and juvenile argument" statement. You thought you put out a nice argument....while all the while i had already said, supply based on demands, seem like you dont know the situation well and outright bluntly shoot ppl who know more than you...bad bad.. say sorry.

 

[snowbird]

Walau...i thought i gave you a nice slap on face, when in fact 12.5% is actually contractor margin...i dont understand why you even bother to quote such unmeaningful data, do contractor margin explain viability of FC? if totally irrelevant, why you even bother to quote? I have to say, nice shun! Also you had very clever way to shun your shortcoming by not calculating out the income side and only calculating out the cost, what do you expect me to understand from your biased calculation?

Ok before proceed any further, lets slap your face first on the other side:
Honestly, I don't have this figure but with reference to Danga Bay, I'll assume 50% to 60% sold.
Which then means FC has to build all the units which is as much as 35,000 to 40,000 of them in this Phase.
So, need to add building cost of unsold units - 15,000 units X 93m2 X RM4,000 = RM5,580,000,000 or RM5.58 billions.


See, i always say you like to make up story. I said before in my previous post, amount of units build depend on demand sides. You want to make up story, easiest way is to assume they are going to build all 30K-40K units....how do you even get to know that they are going to build 30K-40K units?????

You know the reason why you do not know the % sold? because the supply is not fixed, and when supply is not fixed, no way you can know % sold.
碧桂园主席及执行董事杨国强说，马来西亚的森林城市项目，碧桂园采取的是“以销定产”模式，有能力可以做好。
http://www.sinchew.com.my/node/1626733/碧桂园主席：以销定产‧森林城市销售“微不足道”

So you come out with parking lots cost....this i accept, at least this is variable cost. Reclamation cost, I will rather put it in fix cost category, also infrastructure cost, pier or jetty...are all fix cost...agree? or need me to explain why i put it in fix cost? you know the diff?

I will omit provision of ferry and shuttle service from cost calculation....if such service not profitable, they can just stop it and no long term burdening cost that they need to worry about.

You cannot because FC is build on an island, you expect the tenants to swim across to get home and worse, even if the service is not profitable it has to continue!.
Of course, if FC decides to build a link bridge or tunnel to the island, then its another story.


Now we do the maths again
20K units sold will earn them RM 16B (hey how come you do not calculate out such figure?)
Minus variable cost: 20K units cost RM 7.4B (figure given by you) + parking lot cost RM 1.265 (no building cost of unsold units bcoz they 以销定产, no reclaim land cost bcoz that is fix cost)

They will earn RM 7.335B ringgit, to pay for all the fix cost （total cost for land to reclaim，infra, pier, jetty, fast road lane to ciq etc etc). Not enough? You still think stopping the project or shelving it till a later date may be a good alternative?

You are ignorant and actually showing it here again and again.
"碧桂园采取的是“以销定产”模式" - based on this statement and you just conclude that if FC sold X no. of units, they'll just build X no. of units.
WRONG 100% and I'll enlighten you on this and hope you'll learn.

FC offers a wide range of units to the public for them to select their choice unit based on their requirement - floor size, floor height, orientation, location, price, etc.
To date, about 20,000 units were sold or rather only booked, according to the Johor MB.
But the crucial point is out of how many units were this 20,000 selected from?
Do you know?
I already said I don't know.
This is not a sold-out project because the dozen of sales offices in China were still functioning until the recent closure for "renovation" which means they were still selling until the closure of showrooms, halting the sales.

You totally misunderstood the meaning “以销定产模式", what is it's context and reference!
Surely it don't means we sold 20,000 units then we'll build only 20,000 units.
What they means is they build phase by phase and only build the next phase upon the success of the first phase and so on. This is a wise move which also allows positive cash flow for the onward phases.
Princess Cove is also adopting the same approach.
The first phase is still selling after 3 years in the market, something they least expected, hence the second phase maybe have to shelved for a longer time and the reclaimed land will be left to idle (and cash tied up).
And as for the current phase, even if 90% of certain blocks is sold, FC cannot just build 90% of those blocks!!
I took reference with CG Danga Bay is simply to show you that despite only about 80% were sold, they still need to proceed and build all the units!
CG Danga has 8,000 units and if about 20% unsold is true = 1,600 units.
1,600 units @ average R1Mil. = RM 1.6 billions and this is unrealized profit!!

Of course this amount can be entered the books as assets but you lacks that much required hard cash.
The next question important is : what is the percentage is this 20,000 unit out of this phase, do you know?

For the BTO system of HDB, they will only proceed to build upon receiving, I think, 70% of booking and if this threshold is not reach, the project will be shelved.
What is FC's threshold percentage, do you know?
Has this 20,000 crossed the threshold?
Some news reported 90% sold while some said about 70% sold but non reported 100% sold and FC made no official announcement.
Developers with high confidence on the project will proceed with a low threshold, not sure about FC.

Now, is my explanation about the need to add in the cost unsold units, although quantity unknown, is clear and justified and not makeup story?
So, please don't go around slapping other people, slap yourself first to wake up.

 

[FHBH12]

Project to bring in money

Tuesday, 28 February 2017

BY NABILA AHMAD

GELANG PATAH: The Forest City project, upon completion, is expected to bring in least RM50mil in tax revenue for the local authority every year.

Johor Mentri Besar Datuk Seri Mohamed Khaled Nordin said the revenue would be collected through property or land taxes and that some of the revenue would be used to upgrade or build new facilities for the benefit of the people.

“Despite having oil and gas hubs in Johor, we do not have an oil industry so such a development would bring in additional income for the state every year.

“The upgrading or new facilities include maintenance and the building of new recreational parks, children’s playgrounds and more,” he said.

Mohamed Khaled said this in a press conference after visiting the Gelang Patah area on Saturday.

During the visit, he attended briefings on the upgrading works of Dewan Muafakat in Taman Pulai Utama, Dewan Niaga Mutiara Rini as well as a briefing on the development of Sireh Park, a public park which provides kayaking and other activities in Iskandar Puteri.

Mohamed Khaled also visited Kampung Sungai Melayu, Jambatan Besi Gelang Patah and Tapak Lapang Kampung Pendas Baru.

“The state government has set a target that all local authorities must spend some 40% of their revenue on upgrading of facilities such as recreational areas, pedestrian walkways, hawker centres and others,” he said.

He added that besides all this, the state government has also asked Iskandar Regional Development Authority to conduct research to develop areas in Johor into recreational parks that would accommodate cycling and extreme sports activities.

“We need more recreational areas in Johor and the first phase of development of Sireh Park, spread over 138ha, is expected to be completed by this year,” he said.

During his visit, Mohamed Khaled allocated a total of RM150mil to the Gelang Patah parliamentary area for development projects and to address other community issues.

Read more at http://www.thestar.com.my/metro/com...in-tax-revenue-for-johor/#UgCyAWxZgIXUDjhp.99

 

[FHBH12]

Penalty clause adds to woes of Forest City’s Chinese buyers

BY BEN HO
[email protected]

PUBLISHED: 10:18 PM, APRIL 1, 2017
UPDATED: 2:13 PM, APRIL 2, 2017

SINGAPORE — Chinese buyers of homes at the Forest City megaproject in Johor who cannot proceed with their purchases after capital controls introduced by Beijing are now in limbo, after they found out that they have to pay the developer a hefty compensation for backing out of the deals.

Some of the buyers told TODAY that they discovered this when they tried to seek refunds of the 10 per cent deposit that they had paid for the units by developer Country Garden PacificView (CGPV).

They wanted to cancel their purchases as restrictions on capital outflows introduced by the Chinese government late last year had resulted in them not being able to transfer payments from China.

But the developer told them they would have to pay a penalty equivalent to 30 per cent of the purchase price for foregoing the deal. This clause is in the sales contract, a copy of which TODAY has seen. But some of the buyers said that this was not made clear to them at the time of purchase.

“Nobody told me anything about this clause, not even the lawyer who was present when I signed the agreement,” said Ms Vicky Wu, a 42-year-old joint venture employee from Guangdong. She had purchased a 59 sq m apartment for about RM693,000 (S$219,000), and made the 10 per cent down payment on the day she visited the Forest City sales centre in Johor last December.

Ms Wu, a member of the newly set up “Quit Forest City and get refunds” WeChat group, said she later tried to get a refund from CGPV but was rejected.

Other members of the 50-strong chat group say they face the same predicament as Ms Wu.

“The developer rejected outright my request for a refund,” said Mr Gu Wen, a Chongqing native who had bought a 70 sq m unit for about RM950,000 as an investment.

Asked to comment on the 30 per cent compensation clause, CGPV’s Chief Strategy Officer Dr Yu Runze said the buyers who sought refunds belonged to a small group and were not representative of the majority of its buyers.

“We are in discussions with these concerned buyers and will facilitate the refunds based on the terms and conditions in the purchase agreement,” he added. “Country Garden Holdings and its subsidiaries and entities are law-abiding businesses.”

The developer did not disclose how many people have asked for refunds nor whether it was seeking compensation from any of the buyers for breaking the sales contracts.

The US$100 billion (S$140 billion) Forest City housing development on four man-made islands off Johor will — when completed — combine lush beachfront property with amenities aplenty, according to CGPV.

A joint venture between China’s third-largest home builder Country Garden and Malaysia’s Esplanade Danga 88, it has sold thousands of homes in the project. Mainland Chinese nationals constitute 70 per cent of Forest City buyers.

Some of the Chinese buyers who want to back out of the deal now claim that when they bought the units, they were not given the Chinese-language version of the agreement to sign. As they signed only the English contracts; they were not aware of the exact terms.

In response, Dr Yu said both the Chinese and English contracts contained the same terms and conditions and did not contradict one another.

“Our sales and marketing team at Forest City do make the time and effort to carefully explain the terms and conditions to buyers before they sign the contract,” he said.

Property lawyer Derek Fernandez told TODAY that a 30 per cent penalty clause was “not normal” by Malaysian standards.

“In the event the buyers cannot get a loan to finance their purchase, then the down payment should be refunded. If they have breached the agreement, then only the down payment should be forfeited,” said Mr Fernandez, who is a partner of a Malaysian law firm and well-versed in planning and development laws.

Asked about this, Dr Yu said that the 30 per cent penalty clause was not a downpayment fee. “The terms and conditions outlined in our sales and purchase agreements are in accordance with Malaysian laws and standards,” he added.

Several Chinese buyers said they were also attracted to the Forest City project as they were told by the salespersons that by purchasing a unit there, they could apply for the Malaysia My Second Home Programme (MM2H).

This initiative allows foreigners to live in Malaysia on long-stay visas of up to 10 years, offering the families hope they would be able to commute between the China, Malaysia, and Singapore.

“We found only later that MM2H is not officially linked to the Forest City project,” Ms Wu told TODAY.

In response, CGPV said that while its sales and marketing staff helped the buyers in applying for the scheme, the approval has to be given by the Ministry of Tourism and Culture. “We cannot guarantee the success of obtaining the MM2H status for applicants who are home owners of Forest City,” he said.

Buyers who are seeking a refund said that they hope they could resolve the issue with CGPV soon.

Buyers like Mr Wei Youle from Qingdao who bought a 84 sq m unit for around RM963,000 said that they hope they could resolve the issue with CGPV soon.

“I just hope we can get refunds,” said Mr Wei.

Added Ms Wu: “The whole incident’s a nightmare that I want to wake up from.”

http://www.todayonline.com/singapore/penalty-clause-adds-to-woes-of-forest-city-chinese-buyers

 

[rotikok]

You are ignorant and actually showing it here again and again.
"碧桂园采取的是“以销定产”模式" - based on this statement and you just conclude that if FC sold X no. of units, they'll just build X no. of units.
WRONG 100% and I'll enlighten you on this and hope you'll learn.

FC offers a wide range of units to the public for them to select their choice unit based on their requirement - floor size, floor height, orientation, location, price, etc.
To date, about 20,000 units were sold or rather only booked, according to the Johor MB.
But the crucial point is out of how many units were this 20,000 selected from?
Do you know?
I already said I don't know.
This is not a sold-out project because the dozen of sales offices in China were still functioning until the recent closure for "renovation" which means they were still selling until the closure of showrooms, halting the sales.

You totally misunderstood the meaning “以销定产模式", what is it's context and reference!
Surely it don't means we sold 20,000 units then we'll build only 20,000 units.
What they means is they build phase by phase and only build the next phase upon the success of the first phase and so on. This is a wise move which also allows positive cash flow for the onward phases.
Princess Cove is also adopting the same approach.
The first phase is still selling after 3 years in the market, something they least expected, hence the second phase maybe have to shelved for a longer time and the reclaimed land will be left to idle (and cash tied up).
And as for the current phase, even if 90% of certain blocks is sold, FC cannot just build 90% of those blocks!!
I took reference with CG Danga Bay is simply to show you that despite only about 80% were sold, they still need to proceed and build all the units!
CG Danga has 8,000 units and if about 20% unsold is true = 1,600 units.
1,600 units @ average R1Mil. = RM 1.6 billions and this is unrealized profit!!

Of course this amount can be entered the books as assets but you lacks that much required hard cash.
The next question important is : what is the percentage is this 20,000 unit out of this phase, do you know?

For the BTO system of HDB, they will only proceed to build upon receiving, I think, 70% of booking and if this threshold is not reach, the project will be shelved.
What is FC's threshold percentage, do you know?
Has this 20,000 crossed the threshold?
Some news reported 90% sold while some said about 70% sold but non reported 100% sold and FC made no official announcement.
Developers with high confidence on the project will proceed with a low threshold, not sure about FC.

Now, is my explanation about the need to add in the cost unsold units, although quantity unknown, is clear and justified and not makeup story?
So, please don't go around slapping other people, slap yourself first to wake up.

"You cannot because FC is build on an island, you expect the tenants to swim across to get home and worse, even if the service is not profitable it has to continue!.
Of course, if FC decides to build a link bridge or tunnel to the island, then its another story."
I was blur a bit trying to understand what you try to meant....ohh, forest city are made up by several islands, so they have to connect it up via jetty ah? haha. I thought you were saying the far away planned jetty (should be harbour) service to singapore.

>>Err....phase 1 all units built on the first island...which connected by road liao....no need swim, just drive! Others island will remain as vacant for years and the plan is to build bridge to connect all the islands.
Yes a huge cost, but again, only when demand keep up and making economical sense to build bridge. At this stage, everything happen in well connected first island. Such huge cost able to cover when future demand rises, they will not use current sale to build those jetty or bridge, they do not plan anything on those islands yet, so i will fully omit such cost in my calculation.


As for 以销定产. Thanks for explaining everything, seem like you understand too, not me slap you la, you are in fact slapping this idiot who wrote:
"Which then means FC has to build all the units which is as much as 35,000 to 40,000 of them in this Phase.
So, need to add building cost of unsold units - 15,000 units X 93m2 X RM4,000 = RM5,580,000,000 or RM5.58 billions.

Perhaps now is the time to examine your figure. First, where do you get the idea of initial phase got 35k to 40k units? Sources?
What about the 20K figure? Sources?

Only closest source i can find is from IRDA ceo:
The current stock is 700,000, he noted, excluding about 20,000 to 25,000 units being built by Chinese developers. The supply can "easily be taken up by future demand", he said, citing Iskandar's 7 per cent to 8 per cent growth rate.
http://www.straitstimes.com/business/chinese-developers-still-going-flat-out-with-johors-forest-city

Can you show where all these 20k or 30-40k came from? All my earlier post i already question such figure, as i know, they sold 15k units, but no single sources said how many condo they are building...read their latest company report, page 56, "Aggregate GFA for entire project" left as blank
http://www.bgy.com.cn/UploadFiles/en/Files/2016/9/20160906182416.pdf

I know they are going to build more than they sold, but by how much? To the point until they do not follow their 以销定产 principal? Remember, the demand side will determine how many condo they are going to build, they will open condo by condo after previous condo reach the sale threshold, so in excess of 1 condo or 2, if cant finish, will they continue to open more condo? How many units in a condo? 300 units? Think about it. You using too much past experience, even quote CG danga and princess cove, but both is bad example. CG danga straight away is 8000 units, they do not increase thereafter, while princess cove is set amount of condo in phase 1. Forest city, i remember when i first went there, they only told me few thousand units on offers and the sale is good (and i never thought it can even reach 10K units mark). Back then, the sale gallery do not have so many condos in the model as we see in picture now, I even ask whether they are going to build those curvature buildings in the model...bcoz i only see a row of condos on offer Apparently, very early sale not even intended to build 20K units as you claimed. They really exercised their 以销定产模式, not like what you thought, 20K all in one go, i do not think such action can be called 以销定产, also they do not have set amount of targeted condo in each phases, their phases is more toward development on each island i.e. phase 2 should be developing second island or so on. 以销定产will be more closely follow demands, what you explained, would actually be very wrong! They are not going to build 10-20 condos unsold condo, they will not even open those unsold condo into the market.

Ok la, worse come to worse, 20K units, 15K sold, 5K unsold but need to be build, that will be
15K units * RM800 psf * 1500sf= RM18B

-Cost 15K: 15K units * RM400psf * 1500sf=RM9B
-Parking lot cost=RM 1.265B
-building cost for unsold 5000 units= RM3B
(overall cost 13.265B)

Net gain= RM4.735B to build road, basic infra, land reclaim...not enough? At least this is very safe, hard to be money losing project that worth to continue on, and NO NEED TO DELAY, the project in on the money.

So whether you able to understand the meaning of 以销定产, doesnt matter, even in your scenario, still a very doable project, right?

 

[winners]

Snowbird, I have to admit that most of the points you had brought up on Forest City are very valid. Just ignore that Rotikok. He's probably heavily invested in Forest City and cannot afford to lose. He is just winning the battle but losing the war.

Just let time to tell what will be the eventual outcome for Forest City. Unless Tiongland will reverse their capital control soon, otherwise, it's going to be a perpetual on-going concern for Forest City. Even if they will turn to International buyers, how to convince the vast number of purchasers to commit and fill this gap? Otherwise, I'm sure Forest City's management would have done so long ago already and not just to rely mainly from 1 single source of buyers from Tiongland. Of course it's too big to fail completely, but delays can definitely be anticipated given their current implications.

 

[FHBH12]

Country Garden pledges refund for Forest City buyers caught in Beijing’s crackdown on capital outflows

China’s tighter capital controls are forcing developers to walk away from the domestic market when it comes to selling overseas projects

Summer Zhen
UPDATED : Wednesday, 5 Apr 2017, 8:03AM

Country Garden Holdings, whose Forest City project in Malaysia is the biggest overseas project by a Chinese property developer, said it will refund money to mainland investors caught up in Beijing’s escalating crackdown on capital outflows.

The move is the latest consequence arising from Beijing’s tighter policy on capital controls, with most Chinese developers engaged in selling overseas properties now forced to shift their focus from mainland buyers to other countries.

“We have completely stopped our sales in [mainland] China,” Zhu Jianmin, vice-president of Country Garden, told the South China Morning Post last month in Hong Kong, referring to its flagship Malaysian housing project in Johor, which launched sales in 2015.

In March, the property giant closed all its Forest City sales centres on the mainland, a move first reported by the Post, after stricter government scrutiny on capital leaving China.

For buyers who made down payments on properties at Forest City but are no longer able to transfer the rest of the payment out of China, “they can cancel the transaction and there is no need to pay a forfeit fee”, Zhu said.

Zhu emphasised that the project always abided by the rules and regulations of both Malaysia and China and that only about 5 per cent of buyers were considering withdrawing their purchase.

Forest City, which covers 14 square kilometres of land on four artificial islands near the border of Singapore and Malaysia and is partly backed by the royal family of the state of Johor, has to date sold nearly 17,000 units for contracted sales of about 20 billion yuan (US$2.9 billion), mostly from mainland buyers.

Country Garden has closed its Forest City showrooms in China, including this one in Shanghai. Photo: SCMP
Since the second half of last year, Beijing has continued to roll out tightening policies to stem the flow of money leaving its borders to prevent a large drop in its stockpile of foreign reserves triggered by the yuan’s devaluation.

This year, it implemented new barriers to stop individuals converting yuan into other currencies for overseas property purchases – a practice Beijing had turned a blind eye to in the past – dealing a big blow to developers like Country Garden and mainlanders who dreamed of a home overseas.

Country Garden chairman Yeung Kwok-keung, speaking in Hong Kong last month about the closure of its Forest City sales in China, said developers must follow the rules, otherwise the government would “give you a spanking”.

The crackdown has also got buyers like Vicky Wu very worried.

The 42-year-old white-collar employee from Zhuhai has been asking Country Garden for a refund of the 69,300 Malaysian ringgit (US$15,650) she paid as a 10 per cent deposit for a 59 sq metre flat at Forest City.

As a fresh measure, Country Garden has since this year required all mainland Chinese buyers to make payments in Hong Kong or Singapore, rather than on the mainland, to bypass Beijing’s capital controls.

“The salesman is chasing me for instalments but I’m hesitating,” Wu said. “I’m worried about being put on the government blacklist.”

Wu said there were more than 50 buyers in the WeChat group called “To quit Forest City and get refunds” who were waiting for refunds.

However, because Country Garden salespeople earn high commission for selling units, they may be reluctant to let buyers off the hook despite the official stance on refunds by higher management.

Iris Li, another buyer, has similar concerns. “I have a 400,000-yuan instalment due, which could exceed the limit allowed by the government, but the [Country Garden] salesperson asked me to bring several [credit] cards to complete the payment,” she said.

China only allows individuals to exchange up to US$50,000 worth of yuan into foreign currency annually.

“I feel this could violate the law at the height of the crackdown campaign, but every time I ask the salesman if this is illegal, she becomes silent,” Li said.

To close existing loopholes, UnionPay, China’s biggest interbank payments platform, last month barred mainland Chinese customers from using its transaction system in Hong Kong to pay for property, which puts buyers like Wu and Li in a deeper hole and casts a shadow over Country Garden’s efforts to collect money from its mainland buyers.

“It’s very difficult for individuals to get money outside now,” said Ben Briggs, executive vice-president of Briggs Freeman Sotheby’s International Realty based in Xiamen, China.

Briggs said Chinese demand for overseas property was still strong, given rising concerns over pollution, the yuan’s depreciation and sky-high home prices on the mainland.

In the past when the policy was looser, Country Garden accepted various kinds of domestic payment methods, such as swiping credit cards at its sales centres, bank transfers and even Alipay – a PayPal-like Chinese app – to transfer funds through a mobile wallet to the salesperson. The developer also partnered with Shenzhen financial services company Flying Financial to provide mortgages to its clients, although it is unclear how Country Garden sent the money collected domestically offshore.

“It’s impossible for [Country Garden] to do this blatantly any more,” said David Hong, head of research at China Real Estate Information Corp.

Hong said the Chinese government had always prohibited direct individual investment in overseas property projects, but when enforcing the laws it could be lenient or strict. Once capital outflows slowed, the policy could be eased again, he said.

Capital outflows from China surged to a record US$725 billion last year, compared with US$676 billion in 2015, according to the Institute of International Finance. Much of that money found its way into the overseas property market.

China’s largest office developer, Soho China, said last month that it had to abandon the sale of a Shanghai property to a potential buyer as its plan to use the proceeds to fund an overseas investment became unfeasible under the government’s tougher outbound payment controls.

Almost US$75 billion worth of overseas Chinese investment deals were cancelled last year, a sevenfold increase in the US$10 billion in cancelled deals in 2015, according to the Financial Times.

While Chinese developers are still eyeing overseas expansion, mainland customers are no longer their first choice.

Guangzhou developer China Aoyuan Property Group, which has five residential projects in Sydney, Australia, and just bought a high-end residential project in Canada last month, said the developments would target local Chinese buyers and new immigrants.

Country Garden had also stepped up its strategy to promote Forest City to prospective buyers from Southeast Asia, Japan, South Korea, India, the Middle East, Europe and the US, the company said.

But some developers such as Dubai-based Falcon City of Wonders see it as business as usual, saying the foreign-exchange controls have not dented mainland investors’ interest in buying overseas properties.

“We target any investor who is interested,” said Salem Almoosa, chairman and general manager of Falcon City, a multi-purpose mega project in Dubai covering more than 41 million square feet and housing over 10,000 residential units, which is currently under construction.

“We don’t know how the Chinese will bring their investments to buy the properties,” Almoosa said. “But some of them are owners of businesses who should already have their assets abroad.”

Additional reporting by Daniel Ren

Beijing tightens grip on outflows

October 2016

● UnionPay, the mainland’s biggest bank-card provider, banned customers from using its services to buy investment-related insurance products in Hong Kong

November 2016

● The State Council was reported to be planning to ban outbound investments above US$10 billion, forbid mergers and acquisitions of more than US$1 billion outside a Chinese investor’s core business, and halt foreign real estate deals by state-owned enterprises involving more than US$1 billion

● The People’s Bank of China ordered lenders to stop issuing credit cards that allow customers to transact purchases in dual currencies

January 2017

● China’s foreign-exchange regulator said it would tighten scrutiny on individuals’ foreign-currency purchases and customers must pledge the money would not be used for overseas purchases of property, securities, life insurance or investment-type insurance

March 2017

● UnionPay barred mainlanders from using its services for cross-border acquisitions of properties

http://m.scmp.com/business/companie...ges-refund-forest-city-buyers-caught-beijings

 

[rotikok]

Snowbird, I have to admit that most of the points you had brought up on Forest City are very valid. Just ignore that Rotikok. He's probably heavily invested in Forest City and cannot afford to lose. He is just winning the battle but losing the war.

Just let time to tell what will be the eventual outcome for Forest City. Unless Tiongland will reverse their capital control soon, otherwise, it's going to be a perpetual on-going concern for Forest City. Even if they will turn to International buyers, how to convince the vast number of purchasers to commit and fill this gap? Otherwise, I'm sure Forest City's management would have done so long ago already and not just to rely mainly from 1 single source of buyers from Tiongland. Of course it's too big to fail completely, but delays can definitely be anticipated given their current implications.

Haha, great to just talk talk and not putting out sensible arguement. Being an investor, biggest bad thing to behave is to have fix set of thinking. Im willing to reverse my thought about forest city, but we have to get every possibility right first.

Again, earlier posts had said clearly, both me and snowbird do not know the impact of such capital control. We exchanged our view about, if 20K units (snowbird gave such figure) sold and 50% runaway easily, snowbird will deem a abandon project, project has to be stop or halt to a later period.

Both our calculation actually doesnt support that conclusion.

Luckily he did not come out with 15K units and 50% run away, then i might change my view liao.

So your ultimate concern is, capital control so great until 100% cannot buy....well, i already said in my earlier post, it will be an abandon project.

So my points and views are very consistent, do not keep changing or give wrong facts like snowbird did. If snowbird not even come to details, just say no one will buy under capital control, there will be no way i can argue with him (beside argue about such hypothesis possibility), and i have admit, i will outright defeated, no way i can even win the battle.

Simple la, if you feel snowbird point are very valid, why dont just come and shoot me on my logical flaw? Instead of supporting snowbird baselessly.

 

[snowbird]

"You cannot because FC is build on an island, you expect the tenants to swim across to get home and worse, even if the service is not profitable it has to continue!.
Of course, if FC decides to build a link bridge or tunnel to the island, then its another story."
I was blur a bit trying to understand what you try to meant....ohh, forest city are made up by several islands, so they have to connect it up via jetty ah? haha. I thought you were saying the far away planned jetty (should be harbour) service to singapore.

>>Err....phase 1 all units built on the first island...which connected by road liao....no need swim, just drive! Others island will remain as vacant for years and the plan is to build bridge to connect all the islands.
Yes a huge cost, but again, only when demand keep up and making economical sense to build bridge. At this stage, everything happen in well connected first island. Such huge cost able to cover when future demand rises, they will not use current sale to build those jetty or bridge, they do not plan anything on those islands yet, so i will fully omit such cost in my calculation.

I know you're blur but didn't know can be so blur!
Let me enlighten you one more time.
Forest City comprises of 4 man-made islands, they were proposed as islands and will remain as islands -

Island 1: 979 acres
Island 2: 1,896 acres
Island 3: 405 acres
Island 4: 145 acres

Currently, there is a link road leading from the mainland to island 1 to facilitate building works and movement of visitors to the showroom, it is only a temporary structure.
However, this link road or causeway as they called it, will be dismantled at a later date by FC, see their following statement :

"The management of the environment is our top priority. As per our current proposal, the removal of the CG causeway will be our immediate action now that work has recommenced.
The plan of action is to work with qualified sea grass specialists and engineers in order to ensure the proper and safe removal of the causeway.
It will take us few months to remove the designated causeway."


So, in future, it seems they have to link the islands to the mainland either with raised bridges or ferries or both.
Again, whether building for 2,000 units or 20,000 units on the island, they still need to build this facilities.
Hope you'll learn this time.

 

[snowbird]

Actually how many units had FC sold to date, only they know.
All the previous news on the sales were reported by various news agencies and each mentioned different nos.
And the latest news carried by The Star today mentioned "nearly 17,000 units sold". http://www.thestar.com.my/business/...rest-city-buyers-caught-in-beijing-crackdown/

But looking at all the promotional material, it is hard to see how they can fit in so many units.
I have this feeling that all the numbers mentioned are super inflated, a marketing ploy, to give impression that it's popular and sells very well.
Country Garden Danga Bay which is quite big already and so compact comprises only about 8,000 units.
Which means FC is physically more than 3 times larger taking into consideration several low rise sea view bungalows within the proposal!!!





Base on the above illustrations, that 4 blocks of condos in the middle of picture has only a total of 482 units.
3 blocks - 22 storeys & 1 block 32 storeys.
So, for 17,000 units, there'll be at least 35 X 4 blocks such clusters of buildings and if they are all high rise condos and if mixed with some of lower height blocks, even more blocks!
So, where are the 100 over condo blocks???



But I can't find so many blocks in their only site layout plan.
So, had FC really sold 17,000 units to date is questionable.
And if in reality they had only a fraction of that "17,000 units" sold and now with many wanting to quit and asking for refund, good chance for project to be shelved.

 

[snowbird]

Haha, Im so happy with your poor understanding of law, this reply i can shoot you gao gao again. At the same time, i grab your argument method: google key word, saw a sentence or two points that you think stand on your sides. Then without much deeper understanding it, combine with other points, make up your own story.

Do you mean when those chinese come and buy malaysia ppty, they need to get China gov approval to buy the foreign unit, baru they can buy it? First, think about it, since when buying a foreign ppty, need your local state gov for approval?

I got wash money out before. For example, when i buy australia ppty, malaysia gov has no knowledge about my oversea asset.

Then what state approval has anything to do with "signing of proper binding S&P agreement". The oversea ppty that you purchased, is under that country jurisdiction, hey, this is very basic law that any kindergarten kid will know. S&P that you signed, are legal binding agreement that govern under that country law....do you expect FC S&P agreement is written in mandarin, govern by China law??? Prove: FC is freehold...china law no such thing as freehold.

So your whole argument is flawed, China law do not extend to the point where their citizen bought oversea asset, and want those asset govern by China law...if china do so, this is sovereignty rights violation.

You blur blur mix it with getting approval to send out money from China, to approval to buy overseas ppty. China can denial to grant their ppl to send out money from china, this is within their legal rights...but china ppl do not need to get state approval to buy oversea ppty, simply bcoz china has nothing to do with overseas ppty, no approval needed.

Ouch!!! Big slap on face bcoz you do not know simple law.


Ok, i think a lot of my previous points has cover all the possibilities, i dont think you can come out with your story and make sensible argument.

No bank approval yet
In my previous post, I already said, malaysia bank do not involve much. Later what i discover is, actually obtaining bank in china for overseas mortgage approval is actually much harder. Those 20K buyers...i would suspect a big portion of them are actually very cash rich, or they able to obtain loan from overseas financial institution esp from hongkong to support the purchase.
View attachment 30114
http://hn.meifang.com/uploadfile/2016/0412/20160412023523498.jpg

See, the downpayment for the booking fees is 10% of the total ppty price.

So I do not worry about what registered buyer or merely paying booking fees means. In my previous post I had already mention, getting booking fees back is very hard, or CG unwilling to release those buyers. In Malaysia law, paying 10% is when you sign S&P. I dont know what Khaled (again is malaysia minister, rmb my comment about malaysian minister?) meant by saying "just pay (10%) booking fees" and yet still not registered buyers. If people just come and book, without any money pay, tomorrow I go CG, the booking sale result can instantly gone up to 100K units, no problem if booking no need to pay any money.

So eventually the final question will be: among 20K units sold, and assume we allow easy give up and willing to return a refund. How many % will remain?

Rmb this question that i asked in my past previous post? You said 50%, the whole thing condemn....really?

50% give up, still got 10K units need to be built.... so the net earning will still be RM 4B..... still a very viable project even FC faced 50% demand decreased.

The only way to make you point valid to prove that FC will be a failure abandon project, is to prove that it will be 0 sales, everyone will runaway from the project....you tried, using your law from Mars. But..please back to earth, the project is still alive.

IF agree what i said, like my previous post request, no need to apologize...just thank me to point out your error, together with this post to reply your logical flaw.

Cannot understand simple English and want to talk so much rubbish!
Read what I wrote again carefully!!!
Did I say that they need China's approval to buy properties outside China??
Isn't it a fact that you need the State's approval, in this case the State of Johor's approval, before you can purchase properties in Malaysia, FOR ALL FOREIGNERS???
You can pay a deposit or booking fees but subject to State approval of your purchase or bank loan approval, where applicable, before proceeding to sign the S&P agreement, so technically, you're not a buyer yet, you just shown an interest and booked a unit.
Understand the difference now?
Been teaching you something new every time, say thank you!

For FC with the showrooms in China, what kind of payment arrangement they have there is between the FC and the buyers in China.
For that booking fees, they can call it by any name, deposit, first installment, etc.
When they say “签约” , what agreement is that?
The actual S&P agreement or just an simple agreement to buy between the seller and buyer confirming the unit and the price.
How much had been collected and how were they being collected is within the FC in China, not sure the local partner is aware of every details.
By right, upon booking, the FC showroom in China forward the buyer list to the Johor for immediate State approvals in order to proceed with the actual S&P agreement!

As for the Johor MB, he should know better because the State approval comes from his office.
So, when he said last month : There are no registered buyers but only bookings is very simple and clear and should be quite true too because no State approvals been issued so far.

Now, start slapping your own face hard!

 

[James Porn]

HONG KONG: Country Garden Holdings, whose Forest City project in Malaysia is the biggest overseas project by a Chinese property developer, said it will refund money to mainland investors caught up in Beijing’s escalating crackdown on capital outflows.

The move is the latest consequence arising from Beijing’s tighter policy on capital controls, with most Chinese developers engaged in selling overseas properties now forced to shift their focus from mainland buyers to other countries.

“We have completely stopped our sales in [mainland] China,” Zhu Jianmin, vice-president of Country Garden, told the South China Morning Post last month in Hong Kong, referring to its flagship Malaysian housing project in Johor, which launched sales in 2015.

In March, the property giant closed all its Forest City sales centres on the mainland, a move first reported by the Post, after stricter government scrutiny on capital leaving China.

For buyers who made down payments on properties at Forest City but are no longer able to transfer the rest of the payment out of China, “they can cancel the transaction and there is no need to pay a forfeit fee”, Zhu said.

Zhu emphasised that the project always abided by the rules and regulations of both Malaysia and China and that only about 5 per cent of buyers were considering withdrawing their purchase.

Forest City, which covers 14 square kilometres of land on four artificial islands near the border of Singapore and Malaysia and is partly backed by the royal family of the state of Johor, has to date sold nearly 17,000 units for contracted sales of about 20 billion yuan (US$2.9 billion), mostly from mainland buyers.

Since the second half of last year, Beijing has continued to roll out tightening policies to stem the flow of money leaving its borders to prevent a large drop in its stockpile of foreign reserves triggered by the yuan’s devaluation.

This year, it implemented new barriers to stop individuals converting yuan into other currencies for overseas property purchases – a practice Beijing had turned a blind eye to in the past – dealing a big blow to developers like Country Garden and mainlanders who dreamed of a home overseas.

Country Garden chairman Yeung Kwok-keung, speaking in Hong Kong last month about the closure of its Forest City sales in China, said developers must follow the rules, otherwise the government would “give you a spanking”.

The crackdown has also got buyers like Vicky Wu very worried.

The 42-year-old white-collar employee from Zhuhai has been asking Country Garden for a refund of the 69,300 Malaysian ringgit (US$15,650) she paid as a 10 per cent deposit for a 59 sq metre flat at Forest City.

As a fresh measure, Country Garden has since this year required all mainland Chinese buyers to make payments in Hong Kong or Singapore, rather than on the mainland, to bypass Beijing’s capital controls.

“The salesman is chasing me for instalments but I’m hesitating,” Wu said. “I’m worried about being put on the government blacklist.”

Wu said there were more than 50 buyers in the WeChat group called “To quit Forest City and get refunds” who were waiting for refunds.

However, because Country Garden salespeople earn high commission for selling units, they may be reluctant to let buyers off the hook despite the official stance on refunds by higher management.

Iris Li, another buyer, has similar concerns. “I have a 400,000-yuan instalment due, which could exceed the limit allowed by the government, but the [Country Garden] salesperson asked me to bring several [credit] cards to complete the payment,” she said.

China only allows individuals to exchange up to US$50,000 worth of yuan into foreign currency annually.

“I feel this could violate the law at the height of the crackdown campaign, but every time I ask the salesman if this is illegal, she becomes silent,” Li said.

To close existing loopholes, UnionPay, China’s biggest interbank payments platform, last month barred mainland Chinese customers from using its transaction system in Hong Kong to pay for property, which puts buyers like Wu and Li in a deeper hole and casts a shadow over Country Garden’s efforts to collect money from its mainland buyers.

“It’s very difficult for individuals to get money outside now,” said Ben Briggs, executive vice-president of Briggs Freeman Sotheby’s International Realty based in Xiamen, China.

Briggs said Chinese demand for overseas property was still strong, given rising concerns over pollution, the yuan’s depreciation and sky-high home prices on the mainland.

In the past when the policy was looser, Country Garden accepted various kinds of domestic payment methods, such as swiping credit cards at its sales centres, bank transfers and even Alipay – a PayPal-like Chinese app – to transfer funds through a mobile wallet to the salesperson. The developer also partnered with Shenzhen financial services company Flying Financial to provide mortgages to its clients, although it is unclear how Country Garden sent the money collected domestically offshore.

It’s very difficult for individuals to get money out [of China] now

“It’s impossible for (Country Garden) to do this blatantly any more,” said David Hong, head of research at China Real Estate Information Corp.

Hong said the Chinese government had always prohibited direct individual investment in overseas property projects, but when enforcing the laws it could be lenient or strict. Once capital outflows slowed, the policy could be eased again, he said.

Capital outflows from China surged to a record US$725 billion last year, compared with US$676 billion in 2015, according to the Institute of International Finance. Much of that money found its way into the overseas property market.

China’s largest office developer, Soho China, said last month that it had to abandon the sale of a Shanghai property to a potential buyer as its plan to use the proceeds to fund an overseas investment became unfeasible under the government’s tougher outbound payment controls.

Almost US$75 billion worth of overseas Chinese investment deals were cancelled last year, a seven-fold increase in the US$10 billion in cancelled deals in 2015, according to the Financial Times.

While Chinese developers are still eyeing overseas expansion, mainland customers are no longer their first choice.

Guangzhou developer China Aoyuan Property Group, which has five residential projects in Sydney, Australia, and just bought a high-end residential project in Canada last month, said the developments would target local Chinese buyers and new immigrants.

Country Garden had also stepped up its strategy to promote Forest City to prospective buyers from Southeast Asia, Japan, South Korea, India, the Middle East, Europe and the US, the company said.

But some developers such as Dubai-based Falcon City of Wonders see it as business as usual, saying the foreign-exchange controls have not dented mainland investors’ interest in buying overseas properties.

“We target any investor who is interested,” said Salem Almoosa, chairman and general manager of Falcon City, a multi-purpose mega project in Dubai covering more than 41 million square feet and housing over 10,000 residential units, which is currently under construction.

“We don’t know how the Chinese will bring their investments to buy the properties,” Almoosa said. “But some of them are owners of businesses who should already have their assets abroad.” - SCMP

http://www.thestar.com.my/business/...rest-city-buyers-caught-in-beijing-crackdown/

 

[Manhattan]

Let's be frank about it. Without China buyers, this development is nothing.

 

[FHBH12]

Fewer than 60 China buyers want to withdraw from Forest City: Country Garden
Posted 06 Apr 2017 12:10

SINGAPORE: Despite the closure of China showrooms promoting the massive Forest City project planned in Malaysia last month, fewer than 60 buyers in China have asked about cancelling their bookings, Chinese developer Country Garden Holdings (CGH) said on Thursday (Apr 6).

The company said it sold more than 15,000 residential units under the project last year. Chinese nationals accounted for 70 per cent of its buyers for the 18 billion yuan (US$2.61 billion) worth of apartments, it previously stated.

The developer shut its sales galleries in China for the multi-billion dollar project in Malaysia's ambitious Iskandar special economic zone from Mar 13 "to better fit with current foreign exchange policies and regulations" and as the firm looked to diversify its development strategy.

The closure of the showrooms meant that mainland Chinese buyers interested in the Forest City project had to find their own ways to CGH's sales gallery in Iskandar Malaysia.

The firm said in a statement on Thursday it was "currently in discussion" with the buyers who had enquired about pulling out from the project.

A penalty clause ranging from 10 per cent to 30 per cent is applicable if the buyer decides to default on the payment or cancels the sales and purchase agreement after it is signed, as this is deemed a breach of contract, the developer stated.

The company also said that it was "on track" to build and deliver the residential commercial units for Forest City on schedule.

It added that it expects more diversified revenue from sales and rental for a variety of properties commercial and residential properties and is in "positive discussions" with more than 30 companies and investors in the tourism, education and healthcare sectors.

"Attracting businesses into Forest City paves the way for the formation of an economic hub at Iskandar Malaysia and we expect to make some announcements in the coming months."

- CNA/mz

http://www.channelnewsasia.com/news...ant-to-withdraw-from-forest-city/3656590.html

 

[shctaw]

真关了！"新加坡旁"碧桂园森林城市，停止中国销售！

4月5日，香港《南华早报》报道，碧桂园集团副总裁朱剑敏宣布——“新加坡旁”的碧桂园森林城市已经完全停止在中国的销售计划。

前段时间，新加坡眼报道过碧桂园森林城市中国售楼处关门的消息，毕竟碧桂园之前在国内还搞得风风火火的，吸引大批中国买家前往柔佛新山置产。

一夜之间，国内售楼处“全部临时关闭”，这可不是小事儿，森林城市高达80%以上的买家都是中国人，影响之大不言而喻。

4月2日，新加坡眼记者前往大马新山碧桂园森林城市进行采访，新山办公室的策划经理也给了同样的回复，只是暂时关闭，中国销售楼已经开始营业，并认为是媒体将小事放大了。

如此说法，难道真的是3天内决定全面关闭中国销售计划？那为啥还要整修升级？

一名来看房的杭州买家透露，他在国内同样购买碧桂园物业，对于碧桂园的项目相当有信心，却对于大部分森林城市中国售楼处的关闭，完全不清楚。

为了求证，我们给森林城市上海展厅打了个电话，不过和森林城市首席战略官于润泽所称“13日之后已经开始营业”的说法不同，对方工作人员在接听电话后表示，目前展厅还在升级，不接受看房咨询，具体什么时候开放要等公司通知，说白了就是无限期关闭。

至于北京展厅方面，虽然电话畅通，但展厅已经不再是“森林城市”的展厅，而同时接受海南和马来西亚两个房产的咨询。按照澎湃新闻的说法，3月12日，碧桂园下发了内部通知，要求森林城市的国内展厅及工作人员转为推介海南项目。

“国内售楼处关门”的新闻爆发以后，中国驻马大使黄惠康以及柔佛州务大臣卡立诺丁，适时做出了回应，表示中国的资本外流管制并不影响森林城市计划，毕竟项目买家不仅仅是中国人。

3月17日， 于润泽（左一）带领中国驻马来西亚大使黄惠康（左二）巡视森林城市。
不过，目前的状况最终证明，外界的猜测是正确的，森林城市没有逃过国内压制资本外流的命运，最终面临停止销售。