[Exclusive] Why Did the Chinese Government Buy Land in Yongsan?... Value Tripled in Six Years

Close to the Relocation Site of the U.S. Embassy and the Presidential Office
Chinese Embassy: "Usage Delayed Due to COVID-19"

The fact that the Chinese government purchased land in the Itaewon area of Yongsan-gu, Seoul, has only recently come to light, drawing attention to the background of the acquisition. Although Yongsan has long seen steady real estate purchases by foreigners, especially Chinese capital, there has never before been a publicly known case of the Chinese government itself directly buying land in the area.

According to an Asia Economy investigation on May 13, the Chinese government purchased 11 parcels of land, including 262-13 Itaewon-dong, Yongsan-gu, totaling 4,162 square meters (about 1,256 pyeong), for 29.92 billion won. The purchase agreement was signed in December 2018, and the final payment was made at the end of July the following year. The buyer is listed as the People's Republic of China.

In the United States, 35 states have passed or are pursuing legislation to restrict land purchases by Chinese individuals and companies, citing security and other concerns. Canada has also implemented measures prohibiting purchases by foreigners, including Chinese nationals. However, there are no such restrictions in South Korea.

Close to the Relocation Site of the U.S. Embassy and the Presidential Office

The land purchased by the Chinese government is located on the right side of the Namsan foothills, just before entering Namsan Tunnels 2 and 3 from Noksapyeong-daero. The parcels, previously owned by several individuals, had been used as an outdoor golf practice range for nearly 50 years since the early 1970s. The golf range closed down around the time ownership was transferred to the Chinese government. The house on the property has remained vacant for six years.

Of the 11 parcels sold, 2 were previously owned by the South Korean government. In June 2017, the government sold one residential and one forest parcel to a private individual, and the Chinese government later purchased these parcels from that individual. Ownership was transferred to the Chinese government just one year and six months after the government sold the land to the private owner.

The land purchased by the Chinese government is about 1 kilometer in a straight line from the former Yongsan U.S. military base's Camp Coiner site, which is the planned relocation site for the U.S. Embassy in Korea. The decision to build the new embassy at the Camp Coiner site near Sookmyung Women's University Station on Subway Line 4 was finalized in 2005.

The Yongsan Presidential Office and the presidential residence in Hannam-dong are also only about 1.5 kilometers away in a straight line. The underground section of the site is traversed by the GTX-A (Greater Seoul Metropolitan Express Railway) line. In 2020, the Ministry of Land, Infrastructure and Transport established a superficies on the land and compensated the Chinese government 30.93 million won.

The Chinese government has not yet utilized the 4,162㎡ of land consisting of 11 parcels in Itaewon-dong, Yongsan-gu, purchased in 2019. The photo shows the current state of the land, which was previously used as an outdoor golf practice range. Photo by Minjin Kim.

Chinese Embassy: "Usage Delayed Due to COVID-19"

After making the final payment, the Chinese government installed several CCTV cameras along the land's boundaries but has not put the land to use. The three-story outdoor golf practice range building and fences remain standing, and the three-story Western-style house facing the road is still vacant.

Regarding this, an official from the Chinese Embassy in Korea stated, "The land is for official embassy use," and explained, "The usage has been delayed due to COVID-19." The official did not disclose further details, saying, "The specific use is an internal matter."

Over the past six years, the value of nearby land has risen sharply. As of January 1 this year, the officially assessed value of the property was about 32 billion won (25.48 million won per 3.3 square meters), but recent court appraisals of similar nearby land reached 88 million won per 3.3 square meters. Applying this appraisal price to the land purchased by the Chinese government, the value would now exceed 100 billion won, more than three times the original price.

South Korean citizens and the government cannot own land in China. In contrast, there are no legal restrictions in South Korea preventing foreigners or foreign governments from purchasing land. Not only Chinese individuals but also the Chinese government can freely buy land in Korea. As of 2022, the total area of land owned by Chinese nationals in Korea had already reached 20.66 square kilometers, seven times the size of Yeouido (2.9 square kilometers), and it is estimated to have increased further since then. According to the court's real estate registration information, last year Chinese nationals accounted for 64.9% of all foreign real estate purchases in Korea.

Land and houses in Itaewon-dong, Yongsan-gu, purchased by the Chinese government. Closed-circuit (CC) TVs are installed in several places on the fences. Photo by Minjin Kim.