Dunchon Jugong, Last Remaining 'Commercial Space Issue' Conflict... Tight Disagreement Between Union and Construction Team

Morning of the 7th, Seoul City 'Dunchon Jugong' Mediation Status Briefing
Agreement Reached on 8 out of 9 Items, but Differences Remain on 'Commercial Area'

On May 30th, I visited the reconstruction site of Dunchon Jugong Apartment in Gangdong-gu, Seoul. Temporary walls in front of Dunchon Station on Line 5 and Dunchon Oryun Station on Line 9 displayed banners hinting at the exercise of retention rights for new commercial buildings.
Photo by Hwang Seoyul

[Asia Economy Reporter Hwang Seoyul] Seoul City announced that in the first mediation proposal presented to resolve the conflict between the Dunchon Jugong Reconstruction Construction Business Group and the union, the last of the nine contentious issues, the 'commercial complex issue,' remains unresolved. The city also revealed plans to designate Seoul Housing and Communities Corporation (hereinafter SH Corporation) as the project agent to minimize damage to union members.

On the morning of the 7th, Seoul City held a briefing at Seoul City Hall to announce the 'Seoul City Mediation Status Regarding the Suspension of Construction in the Dunchon Jugong Reconstruction Project.' The city stated that among the nine mediation issues, there is a disagreement between the construction business group and the union regarding the commercial complex issue, and no agreement has been reached.

Currently, the Dunchon Jugong commercial complex is embroiled in a dispute between the commercial complex representative group and the PM (Project Management) company. In July of last year, the current union passed a resolution at an extraordinary general meeting to amend the union bylaws to establish an integrated commercial complex committee representing commercial complex union members and to revoke the status of the previous commercial complex representative group, the 'Dunchon Apartment Commercial Complex Reconstruction Committee.' Subsequently, in December, the integrated commercial complex committee notified REITs In Holdings of contract termination, which brought the conflict with the PM company to the forefront. Kim Jang-su, Director of the Seoul City Joint Housing Support Division, stated, "Unlike the other disputes that have been agreed upon, the commercial complex issue involves the individual interests of union members," adding, "It is a matter that requires consensus through a public discussion process within the union."

The construction business group and the union have each proposed different plans regarding this issue. The union proposed that if the design documents approved for project implementation within 60 days are provided to the construction business group, construction will resume, and any losses incurred by the construction business group due to delays in permits and approvals will be the responsibility of the union. On the other hand, the construction business group suggested that for construction to resume, a general meeting resolution must precede the agreement on the dispute between the union, the commercial complex representative organization, and the PM company.

On the same day, the city also conveyed plans to designate SH Corporation as the project agent after gathering union members' opinions if the construction suspension prolongs. According to Article 28 of the Urban and Residential Environment Improvement Act, if a maintenance project is delayed for a long period or if a majority of union members agree, the mayor or county governor may designate a project agent.