[Asia Economy Reporter Yuri Kim] Hyundai Engineering & Construction announced on the 27th that it proposed the 'Golden Time Sales System' to the redevelopment association of Beomcheon 1-1 District in Busanjin-gu, Busan. The core idea is to depart from the conventional pre-sale method, which covers construction costs by conducting general sales around the start of construction, and instead conduct sales at a time when the market conditions during construction allow for higher general sale prices.
Typically, additional redevelopment project cost shortages are covered by additional contributions from association members. Hyundai Engineering & Construction explained, "For Beomcheon 1-1 District, the additional contribution per household based on the current management disposition approval is expected to be around 200 million KRW. By applying the Golden Time Sales System, sales can be conducted at a time when higher general sale prices can be obtained, resulting in minimized contributions from association members while the completion time remains similar."
Hyundai Engineering & Construction has so far proposed the Golden Time Sales System only in major districts in Seoul’s Gangnam area such as Banpo Jugong Complex 1, 2·4 Districts and Daechi Ssangyong 2nd Complex. The company stated that this proposal "demonstrates its intention to win the contract for Beomcheon 1-1 District."
Additionally, in case of unsold units, a 100% in-kind compensation condition was attached. The 'time of initial management disposition after contractor selection' was specified, along with clear monetary standards. They guaranteed an additional 20% relocation cost on top of the basic relocation cost (LTV 60%), and allocated an additional 15 billion KRW for complaint countermeasures related to tenant compensation and land dispute resolution during project implementation.
To prevent project delays due to unforeseen reasons, they proposed a project promotion fund of 100 billion KRW. In redevelopment projects, project promotion funds cannot be procured through Housing & Urban Guarantee Corporation (HUG) payment guarantees. These funds can only be provided through direct loans or payment guarantees by the contractor. Hyundai Engineering & Construction explained, "We have maintained the highest credit rating in the industry for nine consecutive years and have a debt ratio of only 112%, demonstrating a solid financial structure compared to competitors, enabling stable project progress."
Meanwhile, Hyundai Engineering & Construction named the complex 'Hillstate Iconic.' The design was carried out in collaboration with the world-renowned design firm CallisonRTKL. Through this, a unique exterior design was applied that three-dimensionally expresses the shape of clouds reflected on the building. A sky bridge connecting four apartment buildings features a lounge with panoramic views of Busan. Elevators, a sky pond, walking paths, a library, and a cafeteria are planned to create a community space that feels as if it is above the clouds.
Additionally, they designed a leisure lounge equipped with fitness facilities, an indoor golf practice range, screen golf, a dry sauna, and a multipurpose indoor gymnasium, as well as lounges housing a daycare center, kids caf?, and study rooms. All units are designed with a 4-bay layout, and soundproofing materials to minimize noise between floors, well-type ceilings for openness, and integrated glass railing windows for views will also be introduced.
The Beomcheon 1-1 District redevelopment is an urban redevelopment project on a 27,766㎡ site at 26 Beomil-ro 192beon-gil, Busanjin-gu, Busan, consisting of eight buildings with six basement floors and 49 above-ground floors, totaling 1,511 households (1,323 apartments and 188 officetels), along with retail and ancillary welfare facilities. This district is a double station area within walking distance of Beomnaegol Station on Busan Subway Line 1 and International Finance Center·Busan Bank Station on Line 2. Once the Dongcheon ecological stream restoration project nearby is completed, it is expected to have 'forest proximity,' 'mall proximity,' and 'elementary school proximity' all at once.
Meanwhile, the Beomcheon 1-1 District redevelopment association plans to hold a general meeting on the 7th of next month to conduct a contractor selection vote. Along with Hyundai Engineering & Construction, Bando Construction and POSCO Engineering & Construction have declared their candidacy. The association will hold a first joint briefing session for the three bidding companies on the 29th, prior to the general meeting.
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