Precarious Public Reconstruction and Redevelopment Projects... Resident Opposition Surges Everywhere

[Asia Economy Reporter Ryu Tae-min] "We expected some relief from regulations, but in reality, the floor area ratio barely increased. Our complex is basically considering giving up on public reconstruction." (Miseong Geonyeong Reconstruction Association official)

Although the government is pushing forward with public reconstruction and redevelopment projects as part of the August 4 housing supply expansion plan, many areas selected as project candidates are showing reluctance. This is because the high donation ratio and the implementation of the reconstruction excess profit recovery system make the projects less profitable compared to private reconstruction and redevelopment.

According to industry sources on the 2nd, Miseong Geonyeong in Gwanak-gu, Seoul (Sinlim-dong Sinlim Geonyeong 1st Apartment), one of the five leading public reconstruction project candidates, has reportedly decided to give up on public reconstruction. This is because, contrary to the Ministry of Land, Infrastructure and Transport's initial promise of applying a floor area ratio of 300%, SH Corporation responded through in-depth consulting that the maximum floor area ratio possible is only 250%.

An official from the Miseong Geonyeong reconstruction association said, "A floor area ratio of 250% is the same level as the private reconstruction we were originally planning," adding, "There is no reason to choose public reconstruction with low profitability due to donation requirements." Miseong Geonyeong is a 12-story, 3-building, 492-unit apartment complex completed in 1984. In April this year, it was selected as a leading public reconstruction project candidate along with Sin-gil 13 District in Yeongdeungpo-gu, Mangwoo 1 District in Jungnang-gu, Gangbyeon Gangseo in Yongsan-gu, and Junggok Apartment in Gwangjin-gu, Seoul.

Public redevelopment is also facing difficulties. The first candidate site, Heukseok 2 District in Dongjak-gu, Seoul, is seeing growing opposition as an emergency committee composed of commercial property owners recently demanded the cancellation of the district designation. They submitted a petition to the Seoul Metropolitan Government on the 12th, requesting the suspension of the public redevelopment project.

Heukseok 2 District is a commercial area that has not been able to establish an association even after 12 years since the approval of the association establishment promotion committee in March 2009. Although it was selected as a candidate site in January this year, opposition from residents is expected to intensify the difficulties.

Recently, residents opposing the urban public housing complex project, a follow-up measure to the August 4 plan, formed a nationwide coalition. They announced the formation of the "3080 Public-led Opposition Alliance (Gongban-yeon)," a nationwide coalition centered on emergency committees from each candidate site opposing urban public housing. It is reported that emergency committees from 9 out of 52 candidate sites for the 1st to 5th phases of the complex project have expressed their intention to join Gongban-yeon.