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Reconstruction design proposal for Banpo Jugong Complex 1 District 3, suggested by Samsung C&T (Provided by Samsung C&T)

[Asia Economy Reporter Lee Chun-hee] Samsung C&T is shaking up the redevelopment project landscape by securing the construction rights for Banpo 3rd District (Banpo 3rd Jugoo), the most anticipated redevelopment project in Gangnam, Seoul this year.

On the 30th of last month, Samsung C&T won the contract by obtaining 686 votes (52%) out of 1,316 attending union members (including early voters) at the Banpo 3rd Jugoo redevelopment construction company selection general meeting held at COEX in Gangnam-gu, Seoul.

Despite a five-year hiatus since the Rainbow Apartments in Seocho-dong in 2015, Samsung C&T has returned to the redevelopment project bidding scene and is making the industry nervous by consecutively winning projects. After winning the Shinbanpo 15th redevelopment project in Banpo-dong in April, their first bid, they have now secured Banpo 3rd Jugoo, pushing their total redevelopment project contract amount beyond 1 trillion won in one go.

The construction industry is also highly tense due to Samsung’s successive contract wins. With the overseas construction market shrinking recently, competition for redevelopment project contracts has intensified, and Samsung C&T is successfully winning bids one after another by leveraging the strong 'Raemian' brand power. In fact, at the general meeting, representatives from other redevelopment project unions awaiting construction company selection were also noticeably present.

On the 30th of last month, at the general meeting for selecting the construction company of Banpo Jugong Complex 1 District 3 in COEX, Gangnam-gu, Seoul, employees of Samsung C&T, who succeeded in securing the contract, are cheering. (Photo by Lee Chunhee)

However, there is also an assessment that Samsung C&T has taken on another challenge. Both projects Samsung C&T won this year were sites where the existing construction companies’ contracts were terminated and new selections were made. Shinbanpo 15th terminated its contract with Daewoo Engineering & Construction, and Banpo 3rd Jugoo ended its contract with HDC Hyundai Development Company before selecting a new construction company.

There is dissatisfaction in the industry suggesting that Samsung C&T might be focusing on projects where rapid progress is possible. Moreover, last month, the Heukseok 9th District union in Dongjak-gu also terminated its construction contract with Lotte Construction, and Samsung C&T is emerging as a new candidate for the construction company there.

The fierce competition for Banpo 3rd Jugoo was also a challenge. At the general meeting, even after the results were announced, there were disputes among union members supporting different companies. While Samsung C&T received overwhelming support with 126 votes (75.9%) out of 166 votes in Shinbanpo 15th, the vote difference in Banpo 3rd Jugoo was only 69 votes.

An industry insider said, "If the vote difference is small, failing to win over opposing union members could make project progress difficult," adding, "For smooth project advancement, Samsung C&T will need to engage in intense persuasion of union members."