Due to the economic downturn in construction, approximately 350,000 pyeong of public land leased by the Korea Land & Housing Corporation (LH) this year has been found to have contracts terminated.
According to data submitted by LH to Park Yong-gap, a member of the Democratic Party of Korea on the 8th from the National Assembly's Land Infrastructure and Transport Committee, the public lands that were leased to the private sector and had contract terminations from 2022 until July this year amount to 1,163,244 square meters (approximately 350,000 pyeong) across 45 sites, including Incheon Yeongjong, Paju Unjeong, Hwaseong Dongtan, and Yangju Hoecheon.
The termination amount is 4.3486 trillion won, and the number of dwellings that can be supplied through the respective land is 21,612 units.
Contract terminations were limited to 2 sites and 21,433 square meters (38.3 billion won) in 2022, but surged to 5 sites and 147,116 square meters (374.9 billion won) in 2023, 25 sites and 685,109 square meters (2.7052 trillion won) last year, and 13 sites and 309,586 square meters (1.2303 trillion won) this year.
The size of unsold public land by LH also increased from 1,027,000 square meters in 2022 to 1,336,000 square meters in 2024. In the metropolitan area, there are also 9 public land sites (166,084 square meters) available for the construction of apartments and mixed-use buildings that have not been sold, including Gunpo City, Namyangju City, Ansan City, Hanam City, and Incheon Yeongjongdo.
As the sales of public land have declined, LH has introduced measures to promote the sale of unsold land, such as a land return system, interest-free installment sales, and deferred payment sales starting in 2024, but only 11 out of 49 unsold sites targeted for sales (22.4%) have been sold so far.
The land return system allows a business that purchased land from LH to exercise the return right after a specified period, at which point LH returns the total paid principal amount including the deposit and terminates the contract.
There are 30 business sites with overdue payments for public land lease payments, and the total overdue amount has been estimated at 413 billion won.
Park noted, "The government must stably supply dwellings through the use of public land to achieve stability in national housing," adding, "It is necessary to reduce dependency on the private sector and to shift LH toward directly implementing public land projects to supply dwellings promptly."