Redevelopment of the pilot districts in South Korea's first-generation new towns is expected to slip by one to two years from the government's promised 2027 groundbreaking, and a second round of special redevelopment zone designations is now hitting a bottleneck because of caps on how many units can be approved each year, raising concerns about delays in housing supply. Applications in the Bundang and Pyeongchon new towns exceeded assigned quotas by three to five times, and complexes that fail to win designation must wait at least another year.
Seongnam city received applications covering 66,037 units across 50 zones in 43 filings, including combined development zones, for main redevelopment plans seeking designation as second-round special redevelopment zones in Bundang under the aging planned city program, according to the redevelopment industry on the 9th. The filings were accepted through the 1st. That is 5.5 times this year's quota of 12,000 units. Zones that fail to secure designation must compete again from the start for next year's allocation. "If we were to assign the complexes that were rejected to next year in sequence, that could raise fairness issues, so once next year's quota is allocated, it starts over from square one," a Seongnam city official said. "Under next year's master plan, the assigned quota is 10,000 units, even smaller than this year's."
Experts point to the emergence of a bottleneck at zone designation, the first step of any redevelopment project, at a time when even the first round of pilot districts is failing to move at pace. To speed up projects, they say, the annual caps on permitted redevelopment volume are what need to be revised first. "It is commonplace for complexes rated as highly viable to slow down because of unexpected problems such as disputes among residents," said Kim Je-kyung, head of Tumi Real Estate Consulting. "Rather than imposing limits from the early permitting stage, we need to raise the pace of supply through more flexible volume allocation and by drawing up relocation plans."
