[Report] 'Rapid Integration Planning No.1' Sillim 1 District... Unauthorized Buildings Also Exceed 700 Million Won

Acceleration of Redevelopment with Full-Scale Maintenance Projects
Expansion of Profitability through Floor Area Ratio Increase
Housing Prices Soar... Many Inquiries but Shortage of Listings

A view of the Sillim 1 District area in Gwanak-gu, Seoul, where old low-rise houses are densely packed across narrow alleys. As the Seoul Metropolitan Government has effectively selected this area as the first project site for the 'Rapid Integrated Planning' initiative, expectations for development are growing among residents. Photo by Kim Hye-min

[Asia Economy Reporter Kim Hyemin] "It's been almost 20 years since the redevelopment talks started. Many residents had given up, but now that the city says it will expedite redevelopment, we really wonder if it will happen this time." (Resident A from Sillim-dong, Seoul)

When the reporter visited the Sillim 1 District area in Sillim-dong, Gwanak-gu, Seoul on the 15th, the anticipation for redevelopment was evident everywhere. Residents welcomed the fact that Seoul City had effectively designated the area as the first project under the 'Rapid Integrated Planning' initiative and expected the project to proceed swiftly.

A, who has lived here for over 40 years, said, "Sillim 3 District has already started construction, and Sillim 2 District is scheduled for relocation in March next year, but this area is relatively slow, so many residents are dissatisfied," adding, "Since the city says it will actively intervene, why would anyone oppose it?"

The Sillim 1 District, covering 224,773㎡, is the largest among the Sillim New Town areas. It was designated as a redevelopment promotion zone in 2008 and redevelopment was pursued, but the project had been stalled due to resident conflicts and other issues. Resident B hinted, "Unlike Sillim 2 and 3 Districts, there were many commercial buildings and unauthorized structures, making it difficult to reach the required resident consent rate."

However, after establishing a union in 2019 and being selected last year as a pilot project for the Urban and Architectural Innovation, which is the precursor to Rapid Integrated Planning, redevelopment gained momentum. This year, Seoul City designated it as the first project under Rapid Integrated Planning, which inherits the concept of the Urban and Architectural Innovation project, so it is expected to accelerate further. Seoul Mayor Oh Se-hoon also visited this site first among the Rapid Integrated Planning projects and promised swift development.

A view of the Sillim 1 District area in Gwanak-gu, Seoul, where old low-rise houses are densely packed across narrow alleys. Photo by Kim Hyemin

Sillim 1 District is currently drafting its redevelopment plan. Under Rapid Integrated Planning, Seoul City, which holds urban planning decision authority, is involved from the planning stage, allowing unnecessary administrative procedures to be shortened and significantly reducing the review period. In particular, Seoul City raised the floor area ratio from 230% to 259%, presenting guidelines to increase the number of households from 2,886 to around 4,000, thereby enhancing the project's profitability.

With redevelopment expectations, housing prices are soaring. The head of nearby B real estate agency said, "Unauthorized buildings that can obtain occupancy rights have been swept up by people from Gangnam, and an 8-pyeong (approx. 26.4㎡) building that used to cost 80 million KRW has risen to 750 million KRW in 2 to 3 years," adding, "Inquiries are still many, but most have been sold, making it difficult to find listings." Sillim 1 District has about 1,460 union members, but there are around 700 unauthorized buildings not included in the union, making their proportion high.

However, the issue of selecting a construction company is a challenging problem. A consortium formed by GS Construction, Hyundai Engineering, and DL E&C was the sole bidder but the bid failed. Since then, there has been widespread perception that the union intends to contract directly with them, leading to strong resident opposition. Some residents argue that consortium participation should have been explicitly prohibited from the bidding announcement. Yoo Byung-cheol, head of the Sillim 1 District redevelopment union, said, "Whether to allow consortium participation will be entirely based on residents' opinions," adding, "A conclusion is expected at the general meeting next month."