Redevelopment in Seoul That Had Collapsed Is Rising Again

Rising House Prices Spur Renewed Efforts
Yeomni 4·5 Districts and Nogosan-dong Undergoing Redevelopment Zone Designation
Some Areas of Sinjeong New Town and Geoyeo Macheon New Town Also Included

[Asia Economy Reporter Kim Hyemin] As housing prices surge rapidly, major redevelopment projects in Seoul that were previously stalled are being revived. Redevelopment zones in Seoul that had abandoned their projects due to a downturn in the real estate market are now collectively pushing to re-designate their maintenance zones.

On the 13th, according to the maintenance industry, the Yeomni 4 and 5 districts, which were deregulated areas of Ahyeon New Town in Mapo-gu, Seoul, are making progress one by one in their redevelopment projects. Since yesterday, the Mapo District Office has started a preliminary feasibility vote among landowners in the old Yeomni 5 district around 81 Yeomni-dong. The district office plans to proceed with the designation process for the maintenance zone if the approval rate exceeds 50% after collecting residents' opinions for a month.

The old Yeomni 4 district around 488-14 Yeomni-dong is moving faster. Last month, 76% of the participants (491 out of 569 landowners) voted in favor of redevelopment, initiating the formal maintenance zone designation process. As part of this, the standard date for rights calculation was announced as of yesterday. This measure is to prevent illegal practices such as 'share splitting' before the maintenance zone designation.

A Seoul city official said, "The district office requested the announcement of the rights calculation standard date before establishing the maintenance plan, and it was carried out accordingly," adding, "I understand that a service contract for establishing the maintenance plan and zone designation will be issued soon." According to the preliminary maintenance plan, if redevelopment proceeds normally, 811 households will be built in Yeomni 4 district and 1,337 households in Yeomni 5 district.

These districts, located between Ewha Womans University Station on Subway Line 2 and Daehyeong Station on Line 6, were considered prime redevelopment zones when Ahyeon New Town was designated in 2003, but the projects stalled and the zones were deregulated in 2015.

The redevelopment in this area has gained momentum again due to the successive successes of nearby projects. As large apartment complexes such as Mapo Prestige Xi and Mapo Xi were built nearby and housing prices rose significantly, the drive to resume projects was renewed. In fact, a 85㎡ unit in Mapo Prestige Xi, which moved in this March, is trading at 1.8 to 2 billion KRW.

In line with this, the Nogosan district around 12-204 Nogosan-dong is also entering the preliminary feasibility review stage, showing signs of pushing redevelopment again.

Besides these, redevelopment projects are being re-pursued in various areas that were previously grouped as New Towns. The old 1-5 district (around 1152 Sinjeong-dong) in Sinjeong New Town, Yangcheon-gu, Seoul, is pushing for re-designation as a maintenance zone seven years after deregulation. Although the project was previously stalled due to low feasibility, currently, service contracts for establishing maintenance plans and zone designation are underway.

In the deregulated areas of Geoyeomacheon New Town in Songpa-gu, Machon 1 district is preparing to establish a union this year. This district was deregulated in 2014 due to insufficient aging but was re-designated as a maintenance zone last year. Machon 3 district also established a union last year and is pushing the project aiming for business approval this year, while Machon 2 district is preparing for re-designation as a maintenance zone at the residents' level. Jangwi New Town's districts 8 and 9 have been selected as public redevelopment candidates, and district 12 as an urban complex project candidate, with maintenance projects underway.

A real estate industry official said, "Areas that had been removed from maintenance zones due to resident opposition or the Seoul mayor's authority have been stimulated by the rise in housing prices over the past 2-3 years," adding, "As new apartments nearby begin occupancy and sales prices rise, the enthusiasm for redevelopment is also heating up."