Yangji Maeul integrated reconstruction project designated project operator Monday, drawing attention over President Lee's former home

The Yangji Maeul integrated reconstruction project in Sunae-dong, Bundang-gu, Seongnam, Gyeonggi Province — a first-generation new town reconstruction pilot district encompassing the Kumho, Cheonggu and Hanyang apartment complexes and a commercial association — was officially designated a project operator by the city of Seongnam on Monday.

Yangji Maeul has drawn public attention after President Lee Jae-myung and his wife, Kim Hye-kyung, sold their jointly owned home in the Kumho 1 complex, setting a mortgage of 1.77 billion won ($1.21 million) on the property at the time of the sale.

The Yangji Maeul Integrated Reconstruction Residents' Representative Council said it selected Daesin Asset Trust as the preliminary project operator through an open tender in May, then applied to Seongnam for project operator designation on June 30 with the consent of 78 percent of property owners — and received the designation Monday.

According to the residents' council, Yangji Maeul plans to form a maintenance project committee by the end of this year, select a contractor and obtain project implementation plan approval in the first half of next year, and secure management and disposal plan approval before beginning relocation procedures in 2028.

The project site covers 291,584.3 square meters in Sunae-dong 24, Bundang-gu, Seongnam. The current 4,392 units will be redeveloped into a new large-scale complex of 6,839 units rising 37 stories.

Kim Young-jin, head of the residents' representative council, said the project is moving "at a pace unprecedented for a large-scale reconstruction project in Korea," adding that "owners are united and moving forward together."

Earlier, President Lee and his wife sold their 164-square-meter unit in the Kumho 1 complex for 2.9 billion won on July 14, setting a mortgage of 1.77 billion won on the property. The buyer completed the ownership transfer two days later, on July 16 — a move made in haste because only owners registered before the project operator designation are recognized as association members. The buyer, who signed a separate existing housing purchase contract, is expected to receive the balance payment in October, at which point the funds will reportedly be passed to the sellers — President Lee and his wife — to discharge the mortgage. Some critics have called the arrangement a legal workaround.

According to registry documents from the Supreme Court, President Lee purchased the unit in June 1998 and transferred a half share to his wife, Kim Hye-kyung, in December 2018 — 20 years later. Kim, as a co-owner, does not meet the exception criteria for restricted association membership transfer, which requires holding the property for at least 10 years and residing there for at least five. In other words, her share could not be transferred with association membership status had it been sold after the project operator designation was officially announced Monday.

Meanwhile, a report published Sunday cited data from the Ministry of Land, Infrastructure and Transport's actual transaction price disclosure system showing that at least nine apartment transactions at Yangji Maeul — covering the Kumho, Cheonggu and Hanyang complexes — recorded over the past three months (April 23 to July 22) were concluded with the seller setting a mortgage on the property, the same structure used in President Lee's home sale.

A total of 144 apartment transactions were recorded at Yangji Maeul during that period. Of the 30 deals where building and floor information was disclosed and the transaction price was 1.5 billion won or more, nine — or 30 percent — involved sellers listed as mortgage holders. In most of these cases, the sellers were found not to have met the "10-year ownership and five-year residency" requirement.