Korea Development Bank Successfully Arranges Project Financing for Dongbu Expressway Underground Project

Industrial Bank of Korea, together with KB Kookmin and Woori Bank, announced on the 22nd that they have completed the 'Dongbu Expressway Underground Private Investment Project' and signed a financial agreement worth 1.037 trillion KRW.

The financial agreement involved Industrial Bank of Korea (financial advisor, lead arranger, and agent bank for the creditor group), KDB Infrastructure Asset Management, Kookmin Bank, Woori Bank, and 18 other financial institutions (financial investors and creditor group), as well as the lead construction investor, Daewoo Engineering & Construction Co., Ltd.

This project, carried out by the project operator Dongseoul Underground Road Co., Ltd. under the implementation agreement with the competent authority, Seoul Metropolitan Government, connects Cheongdam-dong in Gangnam-gu to Seokgwan-dong in Seongbuk-gu. It involves constructing a deep underground road with a total length of 10.1 km (4 lanes, two-way, exclusively for small vehicles) and operating it for 30 years under a Build-Transfer-Operate (BTO) revenue-type private investment model. Construction is scheduled to begin in the first half of 2024 and completion is targeted for the first half of 2029.

When opened simultaneously in 2029 with the currently under-construction Samsung-Daechi section (a public project, 2.1 km), travel time between Wolreunggyo and Daechi-dong is expected to be reduced from the current 30 minutes to about 10 minutes. Additionally, approximately 70,000 vehicles per day will be diverted underground, easing traffic congestion on surface roads.

Park Hyung-soon, Vice President of Industrial Bank of Korea, stated, “The undergrounding of Dongbu Expressway will alleviate chronic traffic congestion and resolve frequent flooding issues. Despite the challenging market environment with high interest rates and deteriorating financial liquidity, Industrial Bank of Korea, as Korea’s leading policy financial institution, will make every effort to ensure the successful execution of this project.”