The Gongbei district of Zhuhai
A group of about 300 investors from Macau, Hong Kong and mainland China have lost a total of 400 million yuan (USD59 million) after plans to develop a sprawling shopping center in Zhuhai were allegedly abandoned.
According to a report from the South China Morning Post, which cited information provided by the Hong Kong Federation of Trade Unions, mainland developer Zhaohong Shengshi Industrial Company had started to construct the 690,000 square foot shopping center in the city’s Xiangzhou district, when it established a subsidiary to seek out rental agreements, promising significant returns for investors.
The complex was supposed to open to the public by 2015, but construction was halted and the project is thought by some to have been abandoned. Since the project is unlikely to be completed – and the subsidiary responsible for signing the investor agreement has no significant assets of its own – there is little that buyers can do to recover their investments.
According to the SCMP report, such cases are becoming more common in southern China as eager investors seek to cash in on the fast-growing property market. The eagerness is encouraged by the Central Government’s plans improve connectivity between 11 cities around the Pearl River Delta, known as the Greater Bay Area.
“Since the opening of the Hong Kong-Zhuhai- Macau Bridge, real estate agents and other companies have been actively trying to persuade Hong Kong buyers to invest in commercial property, promising a high profit. But unfortunately many end up falling into a trap,” a representative of Hong Kong Federation of Trade Unions, which is offering assistance to some of the investors, told the SCMP.
Gan Xianmiao, the general manager of the developer company, said that the matter was being handled by the authorities. “Meetings are being held. I’m not in a position to comment on this,” Gan told the SCMP.
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