Despite 1 Year and 2 Months of Negotiations, Deadlock Continues; Hearing Scheduled for December 4
Changwon Special City in Gyeongnam Province has decided to proceed with canceling the designation of the preferred negotiation partner after a marathon negotiation lasting 2 years and 1 month regarding the Masan Marine New City private complex development.
On the 21st, Changwon City announced that it notified the consortium led by HDC Hyundai Development Company, designated as the preferred negotiation partner on the 20th, of a hearing and signaled the cancellation of the designation.
According to the city, the HDC Hyundai Development consortium was designated as the preferred negotiation partner in the 5th public contest for the Masan Marine New City private complex developer held on May 31, 2021.
The city conducted seven rounds of negotiations with Hyundai Development starting from November 4, 2021, until January 10, 2022, to reflect the business plan for 297,000㎡, which is 32% of the total 642,000㎡ site of Masan Marine New City, but failed to narrow differences.
Negotiations were temporarily suspended in January 2022 due to the Gwangju apartment collapse accident, a special committee of the city council, and lawsuits.
Negotiations resumed on November 24, 2022, but after a total of 11 meetings including the final negotiation on November 13 this year, the talks ended without reaching an agreement on major issues.
Both parties agreed on public contributions, regional win-win measures, and the creation of a symbolic building (landmark) through an international contest, but reportedly remained at an impasse over the change of use for residential lodging facilities.
Hyundai Development reportedly continuously requested that the implementation agreement specify that the 1,280 residential lodging units in the business plan could be changed to officetels, fearing that sales of residential lodging facilities would become difficult due to amendments to the Building Act and related laws.
The city understood that when the business plan was submitted, the laws had already been amended or were under legislative notice, and that specifying the change of use for the residential lodging facilities, a major facility in the business plan approved by the selection committee, in the agreement could be seen as preferential treatment, thus consistently rejecting the request.
As the differences in position were not resolved even after the final negotiation, the city deemed further negotiations meaningless, decided to end negotiations on the 13th, and announced the cancellation of the preferred negotiation partner designation.
Following administrative procedures, the city plans to decide on the cancellation of the preferred negotiation partner designation after a hearing process scheduled for December 4.
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