Korea Land & Housing Corporation (LH) held the "LH private-participation project financial support briefing" on the 21st at the LH Gyeonggi Southern Regional Headquarters in Bundang-gu, Seongnam.
The briefing, prepared by LH with the Korea Housing & Urban Guarantee Corporation (HUG), was an occasion to share the structure and operation plan of financial support products designed to expand private builders' participation in "private-participation public dwellings projects." About 250 people, including private builders and financial sector officials, attended the event.
On the day, LH presented an overview of the private-participation projects and the progress of financial support, and HUG provided guidance on the financial support product structure and operations.
The financial support products for private-participation projects prepared by LH and HUG target public presale districts in contractor-type private-participation projects (direct settlement method). They apply not only to newly invited districts but also to districts where construction has started, where private operators have pre-financed amounts due to shortfalls in presale proceeds (unpaid progress payments by LH).
The guarantee limit covers 80% of total project costs for standard public presale, and up to 90% for Newlywed Hope Town and districts with a six-month delay in advance subscription, among others. The interest rate is expected to be at the level of HUG-guaranteed project financing (PF) lending rate. A single annual guarantee fee rate of 0.324% applies.
Oh Joo-heon, head of LH's Public Dwellings Division, said, "We worked to establish a financial support model that can provide tangible help to private builders participating in private-participation projects," adding, "We will continue to do our best to lead a recovery in the construction market based on win-win cooperation with the private sector and to swiftly supply high-quality public dwellings that the public can trust."
After the briefing, LH signed an "implementation agreement on financial guarantees to expand the supply of private-participation public dwellings projects" with HUG. Based on the agreement, the two institutions plan to further strengthen their cooperative system and put the financial support system into full operation.