The ruling bloc has introduced a bill to relaunch the "public direct implementation redevelopment project," a model that failed once in 2021. It is part of the government's restructuring plan for public-led redevelopment projects announced in the Sept. 7 housing supply measures, but backlash is already intensifying. Under the Moon Jae-in administration, the project ran aground due to resistance from landowners over forced expropriation of land and infringement of property rights.
According to political circles and the redevelopment industry on the 19th, lawmaker Jin Sung-jun, former policy committee chair of the Democratic Party of Korea, on the 27th introduced as the lead sponsor a partial amendment to the Urban and Residential Environment Improvement Act, with the main point of establishing the public direct implementation redevelopment project. The Korea Land & Housing Corporation (LH) and the Seoul Housing and Urban Development Corporation (SH) would transfer the land and building ownership of landowners, carry out redevelopment and reconstruction projects directly, and compensate after completion in the form of "priority supply."
Unlike private development under the management and disposition method, the project is characterized by proceeding under a "prepaid in kind" method. The amendment states, "A public direct implementer may compensate owners of land, etc., who agree to make an in-kind contribution of existing land or buildings, with buildings (including appurtenant land) constructed through project implementation." The principle is "ownership transfer first, compensation later." Unlike the management and disposition method, under which the landowner's land ownership is maintained during the project period, the prepaid in-kind method fully transfers ownership at the redevelopment planning stage. The advantage is that by skipping permitting procedures and more easily coordinating interests, redevelopment and reconstruction timelines that used to take more than 10 to 15 years can be shortened to within five years.
Even so, landowners are putting up strong resistance. When a bill is introduced, before deliberation by the competent standing committee, the process includes a "pre-announcement of legislation" to inform the public of the purpose and key details and to gather opinions. During this period (Oct. 30–Nov. 8), of the total 13,526 comments posted on the National Assembly website, all but 13 in favor expressed opposition. One commenter said, "There is a possibility the government will forcibly expropriate land and provide unfair compensation," and added, "If there is a lack of transparency in the project, there is also concern about corruption." Another commenter said, "There are major concerns about infringement of property rights, controversy over forced expropriation through prepaid in kind, weakening of autonomy for landowners and association members, and contraction of private projects."
Although a "carrot" to boost the business feasibility of redevelopment and reconstruction was prepared in consideration of landowner resistance, critics say it is inadequate. The amendment includes a special provision to raise the floor area ratio (the ratio of the sum of floor areas to land area) to 120% of the legal cap and to subdivide or change residential zones. For quasi-residential zones, where the legal cap is 500%, it would be raised to 600%. It also allows separate standards for the operation of contributed acceptance, such as easing requirements for securing urban parks or green space. However, it comes with the condition that up to 20% of the total number of units or total floor area must be supplied as public rental housing.
An academic official who requested anonymity said, "It is not much different from the framework that came out under the Moon administration. This won't cut it," and added, "The key is incentives, and unless there are groundbreaking benefits that can boost profitability—such as exempting the reconstruction excess profit recovery (REPR) and not applying the two-year real residence requirement—the project is likely to fail again." In the Feb. 4 supply measures announced in 2021, the Moon administration said it would supply 136,000 homes over five years in the Seoul metropolitan area and the five major metropolitan cities through the public direct implementation redevelopment project. It later accepted 101 candidate sites, but the follow-up bill, which included measures such as not applying the two-year real residence requirement, failed to clear the National Assembly threshold, causing the project to drift and become void.