Housing Regulations Boost Popularity of Jisik Sanup Center... Record High Number of New Approvals

[Asia Economy Reporter Onyu Lim] Due to the balloon effect caused by strengthened housing regulations, idle funds in the market are flocking to income-generating real estate, leading to a boom in the knowledge industry center market.

According to data from the real estate information provider Economy Man Lab and the Korea Industrial Complex Corporation on the 3rd, the number of new approvals for knowledge industry centers nationwide last year was 77, the highest since related statistics began in 2002. Until 2018, new approvals for knowledge industry centers remained in the tens, but they increased sharply in 2019 (44 cases) and last year.

Previously called "apartment-type factories," knowledge industry centers are multi-story buildings where small and medium-sized enterprises that find it difficult to build factories or offices alone can move in together. Unlike general office buildings, eligibility to move in is restricted, and companies that purchase offices in knowledge industry centers can receive tax benefits such as reduced financial institution loan interest rates and exemptions on acquisition and property taxes.

Especially in the context of historically low interest rates and strengthened government housing regulations, idle funds unable to find investment destinations are concentrating on knowledge industry centers.

In Gyeonggi-do Bucheon-si Okgil District, "The Platform R," in Goyang-si Deogyang-gu Hyangdong District, "DMC Espo K" and "GL Metro City Hyangdong," and in Seoul Guro-gu Seoul Digital Industrial Complex, "Gasan Urban Walk" are either about to be sold or currently on sale, boasting excellent locations and transportation.

Oh Daeyeol, research team leader at Economy Man Lab, said, "Interest in knowledge industry centers is growing due to the prolonged low interest rate trend and government housing market regulations," but added, "In some areas, there are concerns about oversupply, so it is necessary to carefully examine location, transportation, and product composition."