China Authorities Seize Evergrande's Island Resort Towers

Local authorities on China’s Hainan Island have seized close to 40 residential towers built, but not completed, by China Evergrande Group in a controversial mega resort project.

Officials from Danzhou city on the island say the buildings, which contain about 3,900 apartments, will be completed and turned into rental housing, serviced apartments and used for commercial activities.

The move is a turnaround from the city’s announcement late last year that the 39 towers in the Ocean Flower Island development would be demolished, because of environmental and construction violations by the debt-laden developer.

Ocean Flower Island is the world’s largest artificial resort island and has been developed by Evergrande at a cost of nearly $13 billion.

But in April, local media were reporting that local authorities had changed the status of those towers to “confiscation” from “demolition”.

According to the latest document on the project, published by the city government in late October, the authorities have approved changing 16 of the incomplete buildings into rental housing, plus four as service apartments, and the remaining 19 will become hotels, offices and retail space.

The seizure of part of the 800-hectare (2,000-acre), flower-shaped project has added to the woes of what was once China’s top-selling developer, which is reeling under more than $300 billion in debt and struggling to repay creditors.

Evergrande declined to comment.