20 Years After New Town Designation... Relocation Begins in October
5,816 Households Transformed into Mega Apartments
"Will Lead the Real Estate Market Alongside Gangnam"
The Hannam 3 District in Yongsan-gu, Seoul, known as the "largest redevelopment in history," has received the management disposition approval, the final hurdle before relocation and demolition. It has been 20 years since it was designated as a New Town in 2003. With a massive apartment complex of 6,000 households planned between Namsan and the Han River, it is expected that the map of affluent neighborhoods in Seoul will be reshaped.
On the 23rd, Yongsan-gu, Seoul, approved and announced the management disposition plan for the Hannam 3 District redevelopment. Management disposition is the last step before relocation, demolition, and general sale, where the specific compensation scale and asset distribution among union members are finalized. Through this, the number of union members by area and the quantity of general sale units are ultimately determined. This stage can be seen as one where the project's uncertainties are almost eliminated.
Thus, the Hannam 3 District has effectively completed the approval process 20 years after being designated as a New Town in November 2003. The union plans to start relocation in October and begin construction in 2026. Move-in is expected in 2029.
The Hannam 3 District is the largest redevelopment project ever, constructing 5,816 households in the Hannam-dong 686 area. The total project cost reaches 8.3 trillion KRW. Not only the scale but also the location between Namsan and the Han River near Hannam Bridge is considered top-tier.
The redevelopment history of Hannam 3 District is long. Since its New Town designation, the project was delayed due to conflicts among union members and various internal disputes. The project implementation approval was only granted in March 2019, when the original owners, who were in their 60s at the start, had become octogenarians. In June 2020, the project also faced a cancellation of the contractor selection due to overheated competition. Hyundai Engineering & Construction was eventually chosen as the final contractor. Although management disposition approval was initially expected in February, it was delayed as some commercial union members filed a provisional injunction with the court to suspend the effectiveness of the management disposition general meeting. As a result, the redevelopment project, which had been halted for over two months, gained momentum again after the injunction was overturned on the 26th of last month.
Various development projects are underway in the Yongsan area besides Hannam 3 District. First, redevelopment has also started in Hannam Districts 2, 4, and 5. District 2 selected Daewoo Engineering & Construction as the contractor last year, and districts 4 and 5 have established unions and are preparing to select contractors.
The UN Command site south of Yongsan-gu Office, which had been delayed for a long time, is set to be transformed into luxury apartments, officetels, hotels, and cultural facilities. A new blueprint has also been drawn for the declining Yongsan Electronics Market area. On the 15th, the Seoul Metropolitan Government announced plans to turn Yongsan Electronics Market into the "Silicon Valley of Asia," centered on new industries such as artificial intelligence (AI) and virtual reality (VR). The development project for the railway maintenance depot site west of Yongsan Station, which had been abandoned for over ten years after being canceled due to the global financial crisis, is also gaining speed. Seoul plans to develop this site into an international business district.
Jung Bohyun, Senior Researcher of Real Estate at NH Investment & Securities Tax Center, explained, "Hannam-dong offers excellent accessibility and a pleasant environment with the Han River and Yongsan Park, and it will lead the Korean real estate market alongside Gangnam in the future." He added, "The prices of large-sized units in nearby luxury apartments already exceed 100 million KRW per pyeong, so it is expected that the price per pyeong will surpass 100 million KRW upon completion of the Hannam New Town project."
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