[Exclusive] Seoul City Allocates 1,300% Floor Area Ratio Pilot Sites Mainly to Major Corporations and Developers

Announcement of Seoul's Live-Work-Play Revitalization Strategy for Station Areas

Yeoksam-dong Pilot Project Site Owned by a Developer

Handsome Corp. and KT&G Headquarters Also Selected as Pilot Sites

"Benefits Concentrated Among Congl

The Seoul Metropolitan Government announced on September 15 that it has selected six initial pilot sites as part of its plan to reorganize the entire city into a "polycentric city." However, it has been confirmed that most of the designated sites are already owned by large corporations, professional developers, or asset management companies with sufficient financial resources and experience in development, or by companies that have held real estate for an extended period.

The initiative was promoted under the pretense of narrowing development gaps between regions and revitalizing underutilized land. However, since the first beneficiaries are major landowners already equipped with capital and expertise in development, controversy is expected.

On this day, the Seoul Metropolitan Government stated that, following the "Seoul Station Influence Area Job•Residence•Entertainment Revitalization Strategy" announced in March, it will move forward with reorganizing the city into a polycentric urban structure connecting central hubs, transfer stations, and arterial roads. As the first pilot projects, it selected two "Growth Base-Type Mixed-Use Development Projects," which will allow a floor area ratio of up to 1,300% in general commercial districts, and four "Growth Potential Zone Revitalization Projects," which focus on developing major arterial roads outside station areas—a total of six locations.

However, according to The Asia Business Daily's investigation into the ownership of each site, all six areas are held by owners with sufficient development capacity. This is especially true for the two "growth base-type" locations, which benefit the most in terms of floor area ratio incentives.

The area of 680-1, Yeoksam-dong, Gangnam-gu, is privately owned by Seongchan Park—the CEO of Traumhaus and chairman of Raum Art Center—who is well-known as a real estate developer for the luxury townhouse "Traumhaus" series. Park, who founded his company in his mid-30s, built the Traumhaus 1–5 luxury townhouse complexes in Seocho-dong and later expanded his business to include the Raum Art Center in Yeoksam-dong and "The Raum Penthouse" near Konkuk University Station, establishing himself as a leading domestic developer.

The 17-1, Jayang-dong, Gwangjin-gu area is the site of the container complex shopping mall "Common Ground." The land for this mall, which Kolon Industries opened near Konkuk University Station in 2015, is owned by DH Property (formerly Daehan Sangwoon), a real estate leasing and development company that originated from an old taxi company.

The same pattern holds true for the four "growth potential" areas, which are intended to promote balanced development outside station influence areas. Two of these sites are owned by large corporations: the area of 448-1, Seongnae-dong, Gangdong-gu is owned by The Handsome Co., Ltd., a fashion affiliate of Hyundai Department Store Group, and 587-2, Junggok-dong, Gwangjin-gu is owned by KT&G Corporation. When The Handsome acquired the fashion division of SK Networks for KRW 326.1 billion in 2017, the headquarters in Seongnae-dong was also transferred from SK Networks to The Handsome.

The remaining two sites are owned by real estate development and leasing companies. 715-1, Chang-dong, Dobong-gu is owned by Mihwa Concrete, which started as a ready-mixed concrete business and later expanded into residential and real estate ventures. The site at 1066-2, Doksan-dong, Geumcheon-gu, currently used as an indoor golf driving range, is owned by Chang Kang Industry, a company that has been conducting building leasing and development in the Jung-gu area.

Chang Kang Industry is the owner of Gyeonggi Building in Samgak-dong, Jung-gu, Seoul. As a real estate asset management company, it owns several buildings in downtown Seoul and operates various facilities such as rental properties, golf ranges, bowling alleys, and parking lots.

This has led to criticism that the project, which aims to revive neglected low-density land and achieve regional balance, is missing its stated purpose. Daejung Kwon, Distinguished Professor at Hansung University, stated, "If the usage of land owned by conglomerates or wealthy individuals is changed and district designation is altered so that development is left to the private sector, it will eventually end up bestowing benefits on private companies and could trigger allegations of favoritism. In such cases, it is necessary to go beyond simply recovering development profits and pursue public-private joint development to avoid controversy over preferential treatment."

Meanwhile, the Seoul Metropolitan Government clarified that selection as a pilot site does not immediately equate to final project approval or rezoning. The sites were chosen through a comprehensive review of basic requirements such as location, road access, site area, connectivity with surrounding areas, expected development impact, and opinions from each local district government.

The city plans to establish detailed plans for each site by December of this year and will begin administrative procedures, such as submitting planning proposals, starting in January next year. Starting with these six projects, the scale will be expanded to 28 growth hubs and 42 residential hubs, totaling 70 sites, by 2030.

This content was produced with the assistance of AI translation services.