Yongsan was once the place that held the most ambitious dream of urban development in the Republic of Korea. But after the project collapsed in 2013, it had to stand still for 10 years. Today is the moment to open Seoul's next 100 years. Through Yongsan, a future-ready urban structure that integrates work, living, and leisure ("jikjurak"), with an ultra-large development worth 51 trillion won and the supply of 6,000 dwellings, Seoul's competitiveness will take another leap forward.
Seoul Mayor Oh Se-hoon said this at the groundbreaking ceremony for the Yongsan International Business District on the 27th. On the vast empty field of the former Yongsan train maintenance depot area, which has been left as a vacant lot for a decade on prime land in Yongsan, Oh repeatedly said, "We will surely get it done" and "We will complete it to the end," emphasizing his determination to push the project forward.
The Yongsan International Business District was the largest development project that Mayor Oh pushed as part of the "Hangang Renaissance" in 2007, but it ran aground in 2013 without even breaking ground due to the global financial crisis in 2008 and the ensuing real estate downturn. After Oh returned to the Seoul mayor's office in 2022, the city formalized the relaunch of the stalled project. The project zone spans 456,000 square meters (about 138,000 pyeong) around the Yongsan train maintenance depot, and Seoul City aims to create a global business strategic hub with integrated functions including office, commercial, cultural, leisure, and residential.
Unlike the past, when the private sector sought to buy the site and develop it all at once, the public sector, including KORAIL and the Seoul Housing and Urban Development Corporation (SH), is taking part as the main project operator. The public sector will invest about 12 trillion won to prepare the site and infrastructure, after which the private sector will divide the area and develop it by purchasing each parcel. Observers say the project has become more stable because the risk is dispersed. Land sales are scheduled to begin in the second half of next year.
The first area to heat up on news of the relaunch of the Yongsan International Business District was Seobu Ichon-dong, which borders the Yongsan train maintenance depot site. Expectations appear to be at work that it will draw attention as a supporting residential complex going forward. Seobu Ichon-dong was also included in the project zone when development was pursued in the past. An official at A Real Estate Agency in Ichon 2-dong, Yongsan District, said, "When the groundbreaking ceremony was held in 2011, it was a total frenzy. The phone lines were jammed. There were plenty of people saying they would buy without even seeing the house," adding, "It's now a regulated area, so actual residence is required, and inquiries aren't as numerous as back then, but many are looking for listings on development expectations. Major nearby complexes have kept setting record-high prices since the second half began."
A 59-square-meter exclusive (7th floor) unit at Jungsan Shibeom Apartment in Seobu Ichon-dong, built 55 years ago, is currently listed at 1.5 billion won. Compared with a transaction on Aug. 17 at 1.06 billion won (2nd floor), the asking price has risen 440 million won in three months. Jungsan Shibeom Apartment is a land-lease dwelling for which Seoul City owns the apartment site, and the complex is purchasing the land from the city to push for reconstruction. Next-door Ichon Shibeom and Mido Townhouse complexes are also in discussions to purchase city-owned land.
The Wonhyo-ro 4-ga area, separated from the Yongsan International Business District site by a main boulevard, is seeing the same trend. Sanho Apartment, which is pushing for reconstruction into "Yongsan Le-El," saw a 46-square-meter exclusive (13 pyeong) unit trade at 1.7 billion won (1st floor) earlier this month. That is a sharp rise of 300 million won compared with a 1.4 billion won transaction in July. Large nearby complexes in Sancheon-dong, such as Riverhill Samsung and Dowon Raemian, are also repeatedly setting record-high prices. An official at B Real Estate Agency in Sancheon-dong, Yongsan District, said, "With expectations for the Yongsan International Business District's development, many landlords are withdrawing listings they put up or switching them to jeonse. They judge that home prices will rise further," adding, "The acceleration of maintenance projects nearby, such as reconstruction and redevelopment, is also pushing up home prices."
However, there is considerable caution that, as the project is only in its initial stage, it remains to be seen whether it will be successfully completed as in Mayor Oh's blueprint. Some also worry about how many developers will jump into a project that requires massive capital investment when the project financing (PF) market is sluggish. A real estate industry official said, "The office market is tight, and vacancy rates are high even within Seoul," adding, "If a building is put up after paying expensive land prices but there is no leasing demand, revenue may not materialize, so financial players like REITs or asset management companies are inclined to wait and see."