O Sehun's Redevelopment Initiative Starts... 'Gonggong Planning' Public Contest Begins Late September

Seoul City Leads Redevelopment Plan from Project Start to Shorten Duration
Focus on Urban Regeneration Areas and New Town Deregulated Zones
Will Mayor Oh's Pledge for Speedy Housing Supply Be a Breakthrough?

[Asia Economy Reporter Lim On-yu] The core of Seoul Mayor Oh Se-hoon's six major redevelopment deregulation plans, 'Public Planning,' will be launched at the end of September. Although Mayor Oh pledged to expand supply through deregulation even before his election, he had not been able to drive significant policy measures due to the burden of housing prices. It is now expected that he will use the 'Public Planning' method of redevelopment as a breakthrough. 'Public Planning' is a method where the Seoul Metropolitan Government takes the lead in establishing redevelopment plans from the early stages, significantly shortening the project period. Interest is already growing in urban regeneration areas and former New Town zones, raising attention to whether this will unblock the bottleneck in housing supply.

According to the real estate industry on the 18th, Seoul City will start a public contest for private redevelopment through Public Planning at the end of September. The contest period is likely to be between 30 and 45 days, and Seoul plans to select candidate sites within the year. A Seoul City Housing Maintenance Division official explained, "After the Seoul City Council session ends in September, the basic plan will be revised through the Urban Planning Committee review, and then the public contest for Public Planning will begin."

Public Planning involves Seoul City leading the feasibility study and establishing the maintenance plan. The procedure, which usually took about 42 months when handled by autonomous districts, can be shortened to one-third (14 months). Other area designation procedures, such as resident proposals and preliminary reviews (6 months → 4 months) and legal procedures for designating maintenance zones (12 months → 6 months), will also be shortened respectively. Seoul expects that the period required to designate maintenance zones can be reduced from five years to two years through this.

In the market, interest in Public Planning is rising mainly in urban regeneration areas and former New Town zones with severe aging. Urban regeneration areas had applied for government-led public redevelopment last year but were excluded due to reasons such as budget duplication. On the other hand, Seoul City decided to include urban regeneration areas in the Public Planning target, which is expected to serve as an exit strategy for urgently needed redevelopment areas. Currently, urban regeneration areas around Changsin-dong in Jongno-gu, Garibong-dong in Guro-gu, and Jangwi-dong in Seongbuk-gu are reportedly considering applying for Public Planning. Former New Town zones that did not apply for public redevelopment due to resistance to public-led project methods such as those by Korea Land and Housing Corporation (LH) are also showing interest in Public Planning.

Seoul plans to supply 25,000 housing units annually for five years through Public Planning. A Seoul City official said, "Interest in Public Planning is high enough that some areas are collecting consent forms even before the contest," adding, "If a consent rate of over 30% is secured, candidate sites will be selected based on urgency of maintenance such as aging."

Attention is also focused on whether Public Planning can be a breakthrough for Mayor Oh, who is in his fifth month in office, to achieve 'speedy housing supply.' Before taking office, Mayor Oh pledged, "I will completely lift redevelopment regulations within a week," but after inauguration, he said it was "an expression of will" and began to adjust the pace. The problem was the skyrocketing apartment prices due to expectations of redevelopment deregulation. Apartment prices in Seoul have continued to rise steadily even after Mayor Oh took office. As Mayor Oh failed to present significant measures, redevelopment promotion complexes in the Gangnam area such as Apgujeong Hyundai, Daechi Eunma, and Jamsil Jugong 5th Complex launched the 'Gangnam District Maintenance Project Association' to urge Seoul City to ease regulations.

A consulting industry official for maintenance projects said, "Since Mayor Oh cannot escape responsibility for rising housing prices, there are limits to fulfilling promises related to supply expansion," adding, "It seems he prioritized revitalizing redevelopment, which has relatively less impact on surrounding housing prices."