Ministry of Land, Seoul City Joint Call for 2nd Street Housing Redevelopment Project

[Asia Economy Reporter Yoo In-ho] The Ministry of Land, Infrastructure and Transport and the Seoul Metropolitan Government announced on the 22nd that they will conduct the 2nd joint public recruitment for the Garo Housing Redevelopment Project.

The Garo Housing Redevelopment Project refers to a project that renovates aging residential areas on a small scale (within 10,000㎡, or within 20,000㎡ if public interest is met) while maintaining the existing street blocks.

Due to simplified procedures and active support such as project cost loans, 155 associations have been established nationwide by this month. Among them, 14 projects have started construction, and 6 projects have been completed.

Meanwhile, in May, the first recruitment was conducted targeting districts in downtown Seoul wishing to undertake the Garo Housing Redevelopment Project, resulting in 22 applications. The district selection process for joint project implementation is currently underway.

For the 22 applicants, 15 “visiting briefing sessions” were held to introduce the policy purpose and project support benefits of the public participation Garo Housing Redevelopment Project to residents unfamiliar with redevelopment projects.

Considering project implementation requirements and residents’ willingness for joint project execution comprehensively, the final selection of joint project implementation districts is planned for October.

From the 23rd of this month, the 2nd joint public recruitment for the public participation Garo Housing Redevelopment Project will be conducted. As with the first recruitment, various supports will be provided as the public sector participates in the Garo Housing Redevelopment Project.

Based on the high public interest due to public sector participation, the loan interest rate will be reduced from an annual rate of 1.5% to 1.2%, and the loan limit will be increased from 50% to 90% of the total project cost.

Relocation cost loans (annual 1.2%) will be supported up to 70% of the appraised value of existing assets (land and housing). If public rental housing is constructed at 20% or more, various benefits will be granted, including expansion of the project implementation area (from 10,000㎡ to 20,000㎡), relaxation of floor area ratio (according to ordinance regulations) and floor restrictions, and exemption from the sale price ceiling system.

In particular, to strengthen linkage with the Urban Regeneration New Deal Project in this 2nd recruitment, if applications are submitted within Seoul’s Urban Regeneration New Deal Project sites (17 locations), or if living SOC (such as public parking lots) is incorporated into the project plan through recognized urban regeneration projects, additional points will be awarded during selection.

After business feasibility analysis, resident consultations, and selection evaluations, the final selection of the 2nd public participation Garo Housing Redevelopment Project sites is planned for the first quarter of 2021.

Lee Ji-hye, Director of the Housing Regeneration Division at the Ministry of Land, Infrastructure and Transport, said, “We expect the public participation type Garo Housing Redevelopment Project to be activated and improve the residential environment of aging low-rise residential areas,” adding, “We will continue to encourage voluntary participation and interest from residents so that the Garo Housing Redevelopment Project can be actively utilized as a redevelopment method for urban regeneration.”