"Capture the Prime Gangnam Area"… Jamsil Woosung, Xi vs Raemian Two-Way Battle

"Preference for Competition Over Private Contracts"
Relaxed Bidding Conditions Lead to Rivalry Between Samsung C&T and GS Engineering & Construction
Fierce Battle Expected for 'Jamsil Preemption' Following Hannam District 4

"Six construction companies attended the site briefing session, but the ones actively moving are Samsung C&T and GS Engineering & Construction. There is great expectation that these major construction companies competing will enhance the value of the apartments." (Residents of Jamsil Woosung 1, 2, and 3 complexes)

The Jamsil Woosung 1, 2, and 3 reconstruction complexes in Songpa-gu, Seoul, are emerging as a new battleground for construction rights. Following the upcoming selection of a contractor for Hannam District 4 on the 18th, a fierce bidding war is likely to unfold. This atmosphere differs from last year, when selective bidding by construction companies led to numerous private contracts even in the Gangnam area.

Jamsil Woosung Complex 1, 2, and 3 exterior view. Built in 1981, the old buildings stand out. (Photo by Kim Hyemin)

‘1.7 Trillion Won’ Jamsil Woosung "Prefers Competition Over Private Contracts"

According to the maintenance industry on the 16th, the second bidding for the Jamsil Woosung 2nd complex scheduled for March is likely to be a two-way contest between GS Engineering & Construction and Samsung C&T. In the first announcement last September, only GS Engineering & Construction submitted a bid, resulting in a failed auction.

Since then, Samsung C&T has actively expressed its intention to win the contract. At the end of last year, Samsung C&T effectively confirmed its participation by placing Raemian advertisements at bus stops near the complex. Samsung C&T, which is expanding its maintenance project orders again, sees this as a good opportunity to expand the Raemian brand in Jamsil, considered one of the prime areas.

GS Engineering & Construction, which has identified the Jamsil and Seongsu areas as key business sites, also expects this contract to solidify its entry into the prime Gangnam area. An industry insider said, "Although the construction market is sluggish, it is not possible to reduce work orders indiscriminately. Prime locations with guaranteed profits will likely see fiercer competition."

Union Sends Love Calls to Construction Companies "Raises Construction Costs and Eases Conditions for Guaranteed Completion"

An advertisement for the Raemian brand by Samsung C&T near the Jamsil Woosung 1, 2, and 3 complexes. (Photo by Kim Hye-min)

In particular, the union is loosening bidding conditions, creating a competitive environment. The Jamsil Woosung reconstruction union raised the construction cost per pyeong from 8.8 million won to 9.2 million won in the second bidding announcement. The total construction cost increased from approximately 1.6198 trillion won to about 1.6934 trillion won. Increasing construction costs may raise the burden on union members but also increases the profits for construction companies. A union official said, "We raised the construction costs considering those of surrounding complexes. This decision was made to encourage more construction companies to participate."

The conditions for the guaranteed completion commitment letter were also partially eased. One union member said, "After the first failed auction, residents debated whether to proceed with a private contract as is or to ease bidding conditions to encourage competition. The delegate council vote concluded to opt for competition, but the opinion was split by only three votes." A union official explained, "Even if the guaranteed completion commitment letter is received, the condition was changed so that the specific details are included in the construction company's bid proposal."

"Jamsil, Close to Gangnam, with Major Development Benefits Right in Front"

This complex is considered one of the best-located among the reconstruction projects in the Jamsil area. It is a transit-oriented development located just a 2-minute walk from Sports Complex Station on subway lines 2 and 9, and crossing the Tancheon Bridge connects directly to Gangnam’s Samsung and Daechi neighborhoods.

Nearby Jeongsin Girls' Middle and High Schools prevent entertainment facilities from entering, making the neighborhood calm and pleasant to live in. Right in front of the complex, the Jamsil Sports Complex is transforming into a large-scale sports and MICE (Meetings, Incentives, Conferences, and Exhibitions) complex, representing a major development benefit. A local real estate agent said, "Some people sold the Olympic Athletes' Village, which has higher reconstruction potential, to buy Jamsil Woosung. If the nearby development benefits and Tancheon maintenance are realized, the value of this area will rise significantly."

Meanwhile, Jamsil Woosung 1, 2, and 3 complexes, located at 101-1 Jamsil-dong, Songpa-gu, are expected to be reborn through reconstruction as a 49-story building with a total of 2,680 households. Six construction companies, including Samsung C&T, GS Engineering & Construction, Hyundai Engineering & Construction, Daewoo Engineering & Construction, Kumho Construction, and Jinheung Enterprise, participated in the site briefing on the 3rd. Bids will close on March 4, and the contractor will be selected through a union general meeting in April.