Higher Floor Area Ratio Incentives for Building Hotels in Downtown Seoul

Expansion of Floor Area Ratio Incentives to Increase Urban Hotel Supply
Rooftop and Podium Green Spaces Recognized as Open Green Areas

From now on, when redeveloping commercial and office facilities in downtown Seoul, an incentive for floor area ratio (FAR) will be given if a 4-star or higher hotel is built. Based on a 20-story building (with a building coverage ratio of 50%), it will be possible to build up to about 3 additional floors. This is a measure to expand the supply of hotels within commercial areas.

The city sky viewed from Namsan, Jung-gu, Seoul on the 24th. Photo by Jinhyung Kang aymsdream@

According to Seoul City on the 4th, the "2030 Urban and Residential Environment Maintenance Basic Plan," which includes these details, is expected to be reviewed by the Urban Planning Committee by mid-this month and announced next month at the earliest. Once announced, the revised plan will apply to urban maintenance-type redevelopment projects that conduct public viewing for residents.

Urban maintenance-type redevelopment projects refer to projects that supply commercial and office spaces by expanding parks, roads, and other facilities to restore the deteriorated functions of downtown areas. Currently, 75 districts and 528 zones have been designated in Seoul. Among them, 42 districts and 309 zones (58%) are located in downtown areas, and 33 districts and 219 zones (42%) are in areas outside downtown, where projects are underway.

Through this plan, which outlines the direction of urban maintenance-type redevelopment projects, Seoul City will grant up to 100% floor area ratio incentives if 4-star or higher hotels occupy more than 40% of the total floor area in redevelopment sites around Hanyangdoseong, including Gwanghwamun, in downtown Seoul. For commercial and office facilities with a height of 20 stories (building coverage ratio 50%) in downtown redevelopment sites, it will be possible to build up to 3 additional floors. If the hotel ratio is 10% or more of the total floor area, a 25% FAR incentive will be given, and if it is 40% or more, up to 100% will be granted.

The city prepared these incentives to increase the supply of accommodation facilities in downtown areas preferred by foreign tourists. Recently, as the number of foreign tourists has increased, hotel demand has surged, but during the COVID-19 pandemic, many construction plans were changed to office facilities due to the downturn in the tourism industry, resulting in an inability to meet demand. However, the Seoul Metropolitan Council has suggested that expansion is necessary even if the facilities are not 4-star or higher luxury accommodations, so the hotel criteria may be revised.

The city will also relax the standards for open green spaces. Open green spaces refer to green areas open to the public within the city. Through this plan change, green spaces created on rooftops or other non-ground areas will also be recognized as open green spaces. The concept of open green spaces will be changed from "ground-level areas within private land" to "upper-level green spaces within private land that are open for public use." However, only 50% of the planted area in three-dimensional green spaces will be recognized as open green space.

From the developer's perspective, creating green spaces on rooftops and opening them to the public will allow them to receive floor area ratio incentives. To prevent cases where citizens' access is blocked after the building is constructed, the city has set conditions that the green spaces must be directly connected to pedestrian streets or other public spaces and have separate accessible routes. Currently, there is only a provision granting up to 50% FAR incentives for creating observation spaces or similar on the top floor and opening them.

A Seoul city official explained, "The intention is to recognize green spaces such as low-level podium green areas and rooftop greenery. Currently, even if rooftop greening is created, it is often only accessible to building residents, so if it is opened to the public, floor area ratio incentives will be granted."