Site Briefing for Apgujeong District 2 on June 26, Bidding Closes August 11
Hyundai Engineering & Construction Likely to Win District 2 as Competition Fizzles
HDC Hyundai Development Company Wins Yongsan Maintenance Depot Front Zone 1 by 107 Votes
Connection and Non-Residential Facility Strategy Proves Effective, Construction Targeted for 2026
The results of the construction company selection battles for key redevelopment sites in areas such as Gangnam and Yongsan in Seoul are being announced one after another. For Apgujeong District 2, the largest reconstruction project in the first half of this year, Hyundai Engineering & Construction is now the likely winner after Samsung C&T suddenly declared its withdrawal. For the Yongsan Maintenance Depot, HDC Hyundai Development Company secured victory after a fierce competition with POSCO E&C.
Samsung C&T Declares Withdrawal... 'Letdown' for Apgujeong District 2
On June 20, Samsung C&T sent an official letter to the Apgujeong District 2 reconstruction association, announcing its decision not to participate in the bidding for the construction contract. Samsung C&T stated, "We had selected Apgujeong District 2 as a strategic site and were actively preparing to participate in the bidding to build a representative landmark complex. However, after reviewing the association's bidding conditions, we determined that due to the unusual restrictions on alternative designs and financial terms, we would not be able to present the proposals we had prepared."
Recently, the Apgujeong District 2 reconstruction association passed exceptional bidding guidelines at a general meeting of delegates, including: severely limiting the scope of alternative designs; requiring all interest rates to be presented only as CD plus spread; prohibiting proposals for relocation loans with LTV above 100%; prohibiting proposals for additional relocation loan interest rates; and prohibiting the use of other financial techniques.
Samsung C&T has a policy of withdrawing its intention to bid if the association presents bidding conditions favorable to competitors. This is the third time, following Jamsil Woosung and Gaepo Jugong. The company believes that it is more advantageous to withdraw quickly before marketing and other expenses are incurred, even if it takes a hit to its credibility. An industry insider explained, "If bidding proposals are structured from the outset to favor a particular construction company, such conditions can act as poison clauses."
With Samsung C&T's withdrawal, Hyundai Engineering & Construction is now highly likely to win the project. A Hyundai E&C representative said, "We have been preparing for this project for three to four years, and since time is needed to prepare designs, it is unlikely that other construction companies will participate. After two rounds of bidding, a private contract is possible, so we expect to proceed quickly with the construction company selection notice." The Apgujeong District 2 reconstruction project involves building 14 apartment buildings with 2,571 units and community facilities, ranging from five basement levels to 65 above-ground floors, in the area of 434 Apgujeong-dong, Gangnam-gu, Seoul. The association announced the construction company selection bid on June 18 and will hold a site briefing on June 26. The bidding proposal deadline is August 11.
HDC Hyundai Development Company Wins Yongsan Over POSCO E&C
On June 22, the construction company for the Yongsan Maintenance Depot Front Zone 1 was selected. At the selection general meeting, HDC Hyundai Development Company received 250 out of 396 votes, defeating POSCO E&C. Out of a total of 437 association members, 396 attended the meeting.
A bird's-eye view of 'The Line 330' proposed by HDC Hyundai Development Company for the Yongsan Maintenance Depot Front Zone 1. Provided by HDC Hyundai Development Company
HDC Hyundai Development Company presented a design and operational strategy tailored to the characteristics of Front Zone 1, which, unlike typical redevelopment projects, has a high proportion of commercial and office spaces. The company proposed detailed conditions for non-residential facilities, emphasizing connections to Yongsan Station and Sinyongsan Station, commercial facility operation plans, and attracting Park Hyatt. In addition, the company is pursuing a project to build a park in front of Yongsan I'Park Mall and develop the former Railroad Hospital site, which can create synergy with the Front Zone 1 project.
Specifically, the company proposed "The Line 330" as the project name for Front Zone 1, inspired by a 330-meter-long sky bridge. Other project conditions included a construction cost of 8.58 million won per 3.3 square meters, a fixed project loan rate of CD+0.1%, high-value property in kind for apartments, officetels, stores, and offices, a minimum relocation loan of 2 billion won, relocation loan LTV of 150%, a 42-month construction period, and payment of 80% of the refund before occupancy. The Front Zone 1 association will now proceed with official project approval and management planning, moving into full-scale project procedures. The design and permitting process will be carried out with the goal of starting construction in 2026.
Including Front Zone 1, HDC Hyundai Development Company has secured a total of approximately 2 trillion won in redevelopment projects this year. The company has won the Gangwon Wonju Dangae Jugong reconstruction (436.9 billion won), Busan Gwangan District 4 redevelopment (419.6 billion won), Busan Yeonsan District 10 redevelopment (445.3 billion won), and now Front Zone 1 of the Yongsan Maintenance Depot (924.4 billion won), totaling 2.2262 trillion won.
A representative from HDC Hyundai Development Company stated, "We will repay the trust our customers have shown us with the best technology and capabilities, and will continue to create I'Park landmarks not only in Front Zone 1 but also in major cities throughout Seoul and across the country."
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