Bangbae 15 District Reconstruction Fails Again... POSCO E&C Likely to Secure Private Contract

Second Bid Fails Again... 755.2 Billion KRW Mega Project
POSCO E&C Sole Bidder... Private Contract Highly Likely
Sadang and Isu Double Subway Zone "High-End Belt"

The Bangbae 15 District, often referred to as the "final piece of the puzzle" in the reconstruction market of the Bangbae-dong area in Seocho-gu, Seoul, has once again failed to attract multiple bidders in its contractor selection process, with only POSCO E&C submitting a bid. As a result, the likelihood of Bangbae 15 District entering into a private contract with POSCO E&C has increased.

According to the maintenance industry on May 9, the Bangbae 15 District reconstruction association closed its contractor bidding process under an open competition method, with only POSCO E&C submitting the required documents. The bid required a total deposit of 40 billion KRW, consisting of 20 billion KRW in cash and a 20 billion KRW performance guarantee insurance policy. This was the second attempt following the first failed bid in February of this year. At that time, POSCO E&C was also the sole bidder, resulting in the bid being voided due to lack of competition. If a bid fails twice in a row, the association may decide whether to proceed with a private contract through a general meeting.

POSCO E&C has devoted several years of effort to secure the Bangbae 15 District project. The company is aiming for brand synergy and linkage through its high-end brand "Auteire Bangbae" (Bangbae Shindonga Reconstruction), which is already under construction nearby. Auteire is a high-end residential brand launched by POSCO E&C in 2022. The brand is expanding its presence in core areas of Seoul, including Banpo and Dongjak.

Bangbae 15 District is located in a high-value area of central Seoul, benefiting from double subway access at Sadang Station and Isu Station. The surrounding area is already home to high-end apartments built by leading domestic construction companies, including ▲ The H Bangbae (Hyundai Engineering & Construction) ▲ Raemian Oneperla (Samsung C&T) ▲ Bangbae Forest Xi (GS E&C) ▲ Auteire Bangbae (POSCO E&C) ▲ Acro Ritz County (DL E&C).

The Bangbae 15 District reconstruction is a large-scale project involving the construction of apartments, commercial spaces, and community facilities on an 84,934-square-meter site at 463-13 Bangbae-dong, with buildings ranging from three basement levels to 25 floors above ground and a total of 1,688 units. The total construction cost estimated by the association is 755,290,760,000 KRW. The construction cost per 3.3 square meters is approximately 8.7 million KRW. If Bangbae 15 District is ultimately finalized through a private contract with POSCO E&C, the broader reconstruction landscape in the Bangbae area will effectively reach its completion stage.