HDC Hyundai Development "Demolish and Rebuild All Gwangju Hwajeong I-Park"

On the 4th, at a press conference held at the HDC Hyundai Development Company Yongsan headquarters in Seoul to announce additional measures related to the Gwangju Hwajeong-dong I-Park accident response, Chairman Chung Mong-gyu is speaking. / Photo by Moon Honam munonam@

HDC Hyundai Development Company (HDC) announced on the 4th that it will demolish all eight buildings of the Hwajeong I-Park apartment complex in Seo-gu, Gwangju, where an exterior wall collapse accident occurred last January, and reconstruct them anew.

Jung Mong-gyu, Chairman of HDC, held a press conference at the Yongsan headquarters in Seoul that morning and said, "We will demolish all eight buildings of Hwajeong-dong I-Park as requested by the prospective residents and rebuild I-Park." Chairman Jung explained, "Over the past four months, we have been discussing compensation with the prospective residents, but besides Building 201 where the accident occurred, other contract holders also had many safety concerns. We thought the only way to alleviate these concerns was to completely demolish and rebuild."

With the decision to fully demolish and reconstruct, the move-in schedule for Hwajeong I-Park is expected to be significantly delayed. Hwajeong I-Park is divided into Phase 1 and Phase 2, and originally, a total of eight buildings with 847 households (705 apartments and 142 officetels) were scheduled for move-in on November 30 of this year.

The company expects it will take 70 months from demolition to completion. Ha Won-ki, CEO of HDC, said, "The demolition method has not been decided yet, and there are no precedents domestically. Considering local complaints and the approval process, we estimate it will take about 70 months for actual demolition and reconstruction."

Additionally, substantial losses are anticipated for HDC due to compensation for delayed move-in and demolition and reconstruction costs. The contract amount for the Hwajeong I-Park complex is 255.7 billion KRW. This amount is expected to be recorded entirely as a loss due to full demolition and reconstruction. Since the Hwajeong-dong accident is entirely attributable to the construction company's fault, monetary compensation such as delay damages must also be provided to the prospective residents.

HDC plans to focus on full demolition, reconstruction, and damage compensation even if company losses are unavoidable. Chairman Jung stated, "If we do not gain the trust of customers and the public regarding safety, the company's existence has no meaning. Going forward, if there is even a slight loss of trust in safety, we will keep our promises to customers no matter what losses the company incurs."