Major hospitals are sequentially announcing plans to establish general hospitals in new cities. The aging trend is expected to continue to drive steady demand for healthcare, and local governments are also actively working to attract large hospitals. Hospitals expect that branches in new cities will help diversify their revenue structure in connection with research and the health industry.
According to the hospital industry on the 25th, large medical corporations are sequentially promoting the establishment of general hospitals in cities such as Hwaseong and Siheung in Gyeonggi Province and Busan. Attention is focused on whether the new hospital construction plans, which had stalled due to prolonged conflicts in the medical community and rising interest rates, will gain momentum.
Gyeonggi Province's Hwaseong City and the Korea Land & Housing Corporation (LH) plan to conduct a re-public solicitation for the 'Hwaseong Dongtan 2 General Hospital Construction Package Development Project (public land sale)' as early as next month. The site covers a total area of 192,971 square meters, including mixed-use land, supporting land, and medical land, of which the medical land is 43,659 square meters.
Korea University Medical Center, Soonchunhyang University Central Hospital, and Chung-Ang University Medical Center are all competing to build a hospital on the site. In December of last year, each medical institution's school foundation, Korea Central Academy, Dong-eun Academy, and Chung-Ang University, formed a consortium with Mirae Asset Consulting, Daewon & Company, and KSL Company, respectively, and submitted project application guarantees.
However, after no private businesses (construction companies) participated in the first public solicitation held last February, plans to select a preferred negotiation partner in March were delayed. Major construction companies such as Samsung C&T, GS Engineering and Construction, and Hyundai Engineering initially showed interest in participating but were reported to have not participated in the first public solicitation due to concerns about economic recession and lack of revenue.
The medical institutions still showed a strong willingness to enter the Dongtan area. Last month, Korea University Medical Center held a press conference and announced plans to establish a specialized hospital for severe diseases in Hwaseong Dongtan, aiming for a 2035 opening. Chung-Ang University Hospital and Soonchunhyang University Hospital also expressed their intention to proceed according to the re-public solicitation procedures.
Currently, Soonchunhyang University Central Hospital operates four hospitals in Seoul, Gumi, Cheonan, and Bucheon, while Korea University Medical Center operates three hospitals in Guro-gu, Seongbuk-gu Anam, and Ansan in Gyeonggi Province, and Chung-Ang University Medical Center operates two hospitals in Heukseok-dong, Dongjak-gu, Seoul, and Gwangmyeong in Gyeonggi Province. If the hospital in Dongtan, Hwaseong City is added, the patient base could significantly increase.
Hwaseong City is a highly attractive area for hospitals in terms of population and local infrastructure. According to the results of the 2023 population and housing census released by the statistics office last year, Hwaseong City was noted as the city with the largest population increase in the country, adding about 43,000 residents compared to the previous year. Samsung Electronics, Hyundai and Kia Motors, and affiliated companies are located in the eastern and western parts of the city, while pharmaceutical companies have factories in the south.
Medical professionals believe the establishment of the Dongtan general hospital depends on the incentives from local governments and LH for private businesses. Hospitals are reported to still have financial leeway despite the recent crisis in the medical industry. University hospitals entered an emergency management system last year due to deficits in the medical field caused by conflicts with medical professionals, but non-medical revenue, such as from funeral home operations, is increasing or maintaining a stable flow.
A representative from a university hospital in Seoul, who requested anonymity, said, "As the preference for large hospitals is strong, the size of beds and facilities itself attracts patients," adding, "Ultimately, it's a money issue, but if hospitals have accumulated a lot of reserves and have sufficient investment capacity, the pace of new hospital construction will quicken." An LH representative noted, "We are currently going through the re-public solicitation preparation process," and added, "We are also considering adjusting the solicitation conditions by gathering the opinions of the private businesses that showed interest in participating."
Bumin Hospital and Dongguk University Hospital plan to build new hospitals and enter the Myeongji International New Town in Busan's Gangseo District. Though the area has seen an influx of population due to large-scale apartment complexes, it has been evaluated as lacking substantial medical infrastructure, as there are no large hospitals. To address this, Busan City and the Busan-Jinhae Free Economic Zone Authority have been promoting the attraction of general hospitals.
Bumin Hospital purchased a 11,645 square meter site for medical facilities from Busan City in 2010 and held a groundbreaking ceremony in May of last year, proceeding with the construction of Myeongji Bumin Hospital. It is planned to have 350 beds, with two underground floors and 13 above-ground floors, aiming for a 2027 opening.
Dongguk University Medical Center has also declared plans to establish a branch here. Dongguk University Hospital signed a business agreement on the 19th to build a general hospital with 500 beds in the Myeongji International New Town. Construction is set to begin next year, with plans for completion in 2033.
In addition, Seoul National University Hospital is working on the construction project of the 'Siheung Baegot Seoul National University Hospital' within the Siheung Campus of Seoul National University in Gyeonggi Province. The original opening goal was set for 2027, but it has been pushed back to 2029. The bidding for construction companies was unsuccessful due to rising raw material prices.
Seoul National University has reflected the price fluctuation of 57.1 billion won, increasing the project budget to 588.3 billion won, and Hyundai Engineering & Construction has been selected as the construction company through a private contract. Lim Byeong-taek, the mayor of Siheung in Gyeonggi Province, mentioned at a press conference on the 24th, "Construction will commence in August," and added, "It is expected that there will be an annual increase in tax revenue of 2 billion won once the hospital is built."