Forest city unit buyers who default, cancel sales and purchase agreement, to pay penalty

KUALA LUMPUR — Country Garden Holdings Company Ltd, the property developer behind the Forest City project, has said the penalty clause applicable to buyers of certain promoted residential units who default on payment, or cancel their sales and purchase (S&P) agreement, is in accordance with the law – and is tantamount to breach of contract.

In an emailed statement on Thursday (April 6), the company said that it outlines these terms and conditions in the S&P for buyers, as required by Malaysian laws and standards, and that they are available in both English and Chinese at all its sales galleries in China.

“The penalty clause, ranging from between 10 per cent and 30 per cent, only kicks in when a buyer, who has decided to purchase certain promoted residential units, decides to default on payment or cancels their sales and purchase agreement,” the statement read.

Country Garden Holdings said the note was issued to provide clarification in response to media reports and questions brewing around Forest City.

Earlier, reports in various media outlets and channels stated that following Beijing’s imposition of capital control measures to stem an outflow of funds from China, mainland investors are now caught in a bind with their investments overseas.

In response to the Chinese government’s capital control move, Country Garden Holdings stopped all travel-related support services by its sales galleries in China for mainland Chinese travelling to Forest City since March 13.

“This means those buyers who are interested in the Forest City project will have to find their own way to our sales gallery in Iskandar Malaysia,” the company said.

As for the latest development at its Forest City mega-project in Johor, Country Garden Holdings said that between Jan and Dec 2016, it sold 15,000 residential units (both condominiums and villas).

In 2017, it said it expects more diversified revenue from sales and rental from properties like offices, shopping malls, a hotel and a golf course.

“We are currently in positive discussions with more than 30 companies and investors on the possibility of setting up their regional hubs or to jointly-develop and manage real estate assets in Forest City.

“These companies are 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 a few months,” the company announced. MALAY MAIL ONLINE