[비즈한국] Seoul Housing and Communities Corporation (SH) has decided to receive two apartment units instead of taking a cash settlement for land owned within the Hannam District 4 redevelopment project in Yongsan-gu, Seoul. The application includes the largest floor plan type available, of which there are only four units under the current Hannam District 4 implementation plan. Interest is growing over why a public housing provider has opted for a distribution plan that includes such rare, large-scale housing.
According to industry sources, SH completed its member subscription application late last month for land located in Bogwang-dong, Yongsan-gu, which was incorporated into the Hannam District 4 redevelopment site. They applied for one unit each of 187㎡ and 59㎡ (exclusive area). Under the current Hannam District 4 project implementation plan, the 187㎡ unit is the largest floor plan, with only 4 units out of a total of 2,331. SH opted for this distribution plan after a board resolution earlier that month, choosing it over the cash settlement option that had been under consideration.
The land subject to this application is part of a site that was formerly used as a terminal for the Samsung Passenger Transport 81 bus route. In June 2008, Yongsan-gu sold 1,822㎡ of land and a building with a total floor area of 1,768㎡ to SH for approximately 13.6 billion KRW. The building, which served as a garage, office, and dormitory, later became well-known in the region after the barbecue restaurant "Baeknyeon Sonnim" moved in.
The SH-owned Bogwang-dong land was split into two in October 2023. Of the total 1,822㎡, 1,335㎡ was incorporated into Hannam District 3, and 487㎡ into Hannam District 4. The land and building incorporated into Hannam District 3 were acquired by the Hannam District 3 union in November of the same year through a public land purchase agreement. The 487㎡ plot incorporated into Hannam District 4 remained under SH ownership. The subscription application was made for these plots.
The Hannam District 4 redevelopment project is a maintenance project aimed at demolishing aging houses in the area of 360 Bogwang-dong, Yongsan-gu, and creating a large apartment complex. Under the current project implementation plan, a total of 2,331 households will be built, including 1,981 for-sale units and 350 rental units. Samsung C&T, selected as the contractor in January last year, proposed an alternative design consisting of 35 buildings (2,360 units) ranging from 7 basement levels to 20 floors above ground.
SH's decision to apply for both a 187㎡ unit and a 59㎡ unit is seen as utilizing a so-called "1+1 distribution" structure. The Act on the Improvement of Urban Areas and Residential Environment allows for the provision of two housing units within the scope of the previous asset value or the previous residential exclusive area. However, one of these units must be supplied with an exclusive area of 60㎡ or less. These small units under 60㎡ are subject to a resale restriction for 3 years from the day after the previous notice date.
However, it is not guaranteed that SH will ultimately be assigned the largest floor plan and the small apartment in Hannam District 4. Currently, the Hannam District 4 union is undergoing a revision process for the reorganization promotion plan based on the alternative design proposed by the contractor, Samsung C&T. It is reported that the union plans to conduct the distribution process once more based on the future revised plan. Final assignment of housing types per member is expected to take place before the general meeting for the management and disposal plan.
Meanwhile, the specific reason why SH chose the distribution application over a cash settlement has not been confirmed. It is possible that the judgment that receiving redeveloped apartments is more advantageous for increasing future asset value played a role. It is also unknown whether they intend to hold, rent out, or sell the distributed units to recover funds in the future.
An SH official stated, "It is true that we applied for the 187㎡ and 59㎡ units in Hannam District 4," adding, "This was based on a board decision, and specific utilization plans for the housing after completion have not yet been determined."