[Asia Economy Reporter Park Hyesook] Incheon City is selecting commercial buildings that have not raised rent for over 10 years and providing support of up to 20 million KRW for building repair costs.
The city announced on the 12th that it is promoting the 'Win-Win Cooperation Commercial Building' support project to enable tenants to operate stably for a long period without worrying about rent increases.
Last year, the city supported landlords of 7 commercial buildings (20 stores) with a total of 104 million KRW for building repairs, and this year plans to support up to 20 million KRW per building within a total budget of 200 million KRW.
According to the recent application results for the support project, 13 commercial buildings (43 stores) applied, and among them, 10 buildings signed agreements with tenants to not raise rent for over 10 years.
After document screening and on-site verification, the city will select the target commercial buildings next month through the 'Win-Win Cooperation Commercial Building Committee' composed of experts. Afterwards, agreements on support will be signed between the Small Business Support Center and landlords, followed by notarization procedures.
Landlords will be notified of the selection results and can apply for costs after completing building repairs. However, if landlords violate the win-win agreement terms, they must repay the full support amount, interest, and penalties.
Incheon City has been implementing the win-win cooperation commercial building support project since last year to prevent displacement (gentrification) caused by rapid rent increases, reduce social conflicts such as community collapse and unfair relocation of small merchants. The goal is to support 40 commercial buildings by 2022.
A city official stated, "By signing win-win agreements with a rent increase rate lower (2% or less) than the standard (5%) of the 'Commercial Building Lease Protection Act,' tenants can benefit from reduced rent and operate long-term, while landlords can expect an increase in building value by receiving business support funds to repair commercial buildings."
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