Legislative Notice for the Enactment of Subordinate Regulations under the 'Dosim Bokhap Gaebal Act'
The Ministry of Land, Infrastructure and Transport is laying the groundwork for the target areas and scope of deregulation for urban complex development projects involving private specialized institutions such as trusts and REITs (Real Estate Investment Trusts).
On the 27th, the Ministry announced that it will publicly notify the draft subordinate legislation of the "Act on Support for Urban Complex Development (Urban Complex Development Act)," which will be enforced in February next year, for 40 days from the 23rd of this month until December 2nd. This law aims to supplement existing urban maintenance projects by introducing complex development projects that supply high-quality housing and create growth hubs. Through the August 16, 2022 measures, the system was restructured to allow private specialized institutions such as trusts and REITs to become project entities.
The draft includes detailed provisions on the target areas of complex development projects, the scope of deregulation, and conditions for public contributions.
Notably, areas designated as urban complex development innovation districts are divided into "growth hub type" and "residential-centered type." Growth hub type development projects can be implemented within 500 meters of central areas of downtown, sub-centers, or living zones according to the city master plan, or areas where two or more lines such as subway and express bus routes intersect. The degree of aging is not considered.
Residential-centered projects target areas within 500 meters from the station platform boundary or semi-industrial areas near residential zones that require maintenance, where the proportion of aging buildings over 20 years old exceeds a certain threshold. This ratio is set by each local government through city or provincial ordinances within a range of 40% or more.
To revitalize complex development projects, building coverage ratio and floor area ratio can also be expanded up to the legal maximum. In particular, the floor area ratio in quasi-residential areas can be increased up to 140% of the legal maximum.
Some of the development profits resulting from this floor area ratio increase will be used to supply public housing. At least 60% of the public housing provided must be public sale housing.
Additionally, local governments will determine detailed matters such as permits and documentation through city or provincial ordinances, considering urban functions, resident status, and other regional conditions to facilitate project implementation.
Lee Kyung-ho, Director General of Urban Housing Supply at the Ministry of Land, Infrastructure and Transport, said, "We will actively review opinions received during consultations with related agencies and the public notification process, and distribute ordinance guidelines and hold briefing sessions next month to ensure the institutional foundation is fully established."
The draft can be viewed on the Ministry of Land, Infrastructure and Transport website under 'Policy Data - Legal Information - Legislative Notice & Administrative Notice.' Opinions can be submitted by mail or through the website.
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