'Up to 133 Floors' Sangam DMC Landmark Site, Will It Find a New Owner in the New Year?

Seoul City to Proceed with Sixth Land Sale
Enhancing Project Feasibility and Greatly Reducing Participation Burden
Applications Accepted in May → Priority Negotiation Candidate Selected in June

Will the new year bring momentum to the development project of the ‘Sangam Digital Media City (DMC) Landmark,’ which will be up to 133 floors tall? The Seoul Metropolitan Government is launching the sixth land sale to find a developer for the Sangam DMC Landmark site.

According to Seoul City on the 31st, the city began announcing the supply of the Sangam DMC Landmark site on the 28th. This supply announcement resumes after about six months since the fifth land sale was unsuccessful last June.

In reinitiating the sale, the city reflected opinions from the real estate industry and experts to enhance the project's feasibility. First, the residential facility ratio was raised from the previous 20% or less to 30% or less. The proportion of lodging facilities was reduced from 20% or more to 12% or more, and cultural and assembly facilities were decreased from 5% or more to 3% or more. However, to secure public interest, the ratio of ‘other designated use facilities’ such as office, broadcasting and telecommunications, and research institutes was expanded from the previous 20% or more to 30% or more. Office facilities may include office-tels for business use up to 10% or less.

The burden on participating developers was also reduced. The announcement period was extended from 3 months to 5 months to allow sufficient preparation, and the evaluation focus shifted from price to business plans (business plan 80% + price 20% → business plan 90% + price 10%). Additionally, to reduce initial costs, the capital requirement for establishing a Special Purpose Company (SPC), which was previously at least 10% of the total project cost (about 300 billion KRW), was drastically lowered to at least 20 billion KRW.

The Sangam DMC Landmark site consists of two parcels in Sangam-dong 1645 and 1646 and will be sold as a package for joint development. The supply price is 836.5 billion KRW, which is 11.1 billion KRW higher than the price in the fifth sale (825.4 billion KRW). This site is located in a central commercial area with a maximum floor area ratio of 1000% and can accommodate buildings up to 656 meters tall (approximately 133 floors). The city plans to build a mixed-use business center over 50 floors (classified as a super high-rise building under the Building Act) that will serve as a representative landmark of Seoul. The target completion year is 2032.

This land has been left idle despite five attempts to sell it from 2004 until last June without any project commencement. In 2008, ‘Seoul Light Tower,’ a consortium of 25 investors including Daewoo Construction, was selected as the preferred negotiator, but the contract was terminated in 2012 due to difficulties in securing funding. Since then, no developer has come forward.

The city plans to accept applications and business plans by May 28 next year, select the preferred negotiator in June, and sign the sales contract in September.

Kim Tae-gyun, Director of Seoul City’s Economic Policy Office, said, “The landmark site has locational advantages with ongoing projects nearby such as the world’s first ‘Twin Wheel’ giant Ferris wheel, the Gangbuk Transversal Line, and the Daejang Hongdae Line, which can create synergy effects for building a world-class advanced mixed-use business center,” adding, “We hope many domestic and international investors will participate.”