An analysis said that the city of Seoul's move to raise the floor area ratio in the redevelopment of Sewoon District 4 in front of Jongmyo is expected to increase development gains by about 550 billion won. Critics also said that, given the business structure favors private developers, the public share should be increased further.
The Citizens' Coalition for Economic Justice (CCEJ) held a press conference on the 25th at its auditorium in Jongno-gu, Seoul, to present this outlook and opinion. CCEJ said, "Fully disclose the background of the relaxations on the floor area ratio and height, as well as the basis for calculating public contributions," and added, "Immediately halt ultra-high-rise, ultra-high-density development and return to square one for a full review."
Sewoon District 4 is at the center of a dispute over damage to the Jongmyo view. Last year, when the city of Seoul eased height limits for buildings in Sewoon District 4, claims were raised that the view of the facing Jongmyo would be harmed. Jongmyo, a state shrine inscribed in 1995 as Korea's first World Heritage site, carries significant historical symbolism. This is why opinions are divided over raising the redevelopment height cap.
Redeveloping the Sewoon area is also a signature project of Seoul Mayor Oh Se-hoon. The aim is to ease inconveniences for residents caused by long-stalled maintenance projects and to boost the city center's competitiveness. By contrast, the Korea Heritage Service and others oppose the plan, saying that if high-rise buildings go up as the city intends, they will severely damage the outward view from Jongmyo.
On this day, CCEJ argued that by raising the floor area ratio for Sewoon District 4 from 660% to as high as 1,008%, the expected increase in development gains would reach 551.6 billion won. CCEJ said, "The problem is that the public bears the risks and expense, and it is unclear who will take the additional 55.16 billion won in development gains."
CCEJ explained that even though the project costs for Sewoon District 4 are being financed through public funds, the Seoul Housing and Urban Development Corporation (SH), the public project operator, would receive only 69.7 billion won—4% of construction costs—as a service fee.
CCEJ also pointed out that the city granted priority pre-sales benefits to "strategic investors." A strategic investor refers to an entity that makes an upfront investment of a certain scale to help activate the project. CCEJ viewed this provision as creating a structure that gives certain private developers priority pre-sales benefits. There was also concern that more than half of existing land owners could take cash compensation and leave the area.
CCEJ went on to demand a halt to administrative procedures related to the redevelopment, along with transparent disclosure of the background of the relaxations on floor area ratio and height, the basis for calculating public contributions, and who will ultimately receive the additional development gains.
CCEJ also said, "By raising the floor area ratio, Sewoon District 4 has become an ultra-high-density, mixed-use development structure, which is likely to block sunlight and wind corridors in the city center, worsen the microclimate (heat island), and degrade the pedestrian environment."
It added, "Because the Sewoon area in front of Jongmyo is adjacent to the World Heritage site Jongmyo, it is a space that requires public standards and social consensus, yet the city of Seoul expanded the permissible scope of development near Jongmyo by revising its local government ordinance and changing its plans."
Hwang Ji-uk, director of CCEJ's Urban Reform Center, said, "This is a development method you won't find in advanced countries," adding, "It is difficult to restore the damaged landscape and spatial order."
Meanwhile, in Nov. last year, the city of Seoul said that as the floor area ratio for the Sewoon District 4 redevelopment was raised 1.5 times, the amount of development gains to be recouped also increased to 216.4 billion won. The city explained that it raised the burden rate for infrastructure in Sewoon District 4 from 3% to 16.5% and increased the scale of development gains to be recouped through public contributions to 216.4 billion won, 12 times the previous 18.4 billion won.