HONG KONG: Almost 40 residential buildings of China Evergrande Group’s mega resort project on Hainan island seized by the local government will be completed for rental housing, serviced apartments and commercial activities.

In December, the government of Danzhou city ordered demolition of 39 towers in the Ocean Flower Island development, containing roughly 3,900 of the project’s 65,000 homes, because of environmental and construction violations.

Ocean Flower Island is the world’s largest artificial resort island and has been under development by Evergrande for nearly $13 billion.

By April, local media were reporting that the 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, four into service apartments, and the remaining 19 into hotels, offices and retail space.

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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.