District plans to sell 2,260-square-meter youth housing site to LH to fund public facilities as project costs nearly double from 61.4 billion to 117.8 billion won
A long-stalled plan to redevelop an aging public office complex in Bangi-dong, Songpa-gu, Seoul has entered a new phase as the district pushes to restructure the project amid a near-doubling of costs. Songpa-gu has proposed selling a youth housing site to the Korea Land and Housing Corp. (LH) to fund the construction of public facilities, but the district council has blocked the plan by removing a related shared-property management proposal from its agenda.
According to Songpa-gu, the district is seeking to restructure the mixed-use redevelopment project at a roughly 11,276-square-meter site in Bangi-dong to move toward an early ground-breaking.
The project calls for replacing the aging Bangi 2-dong community center with a complex that includes a welfare center, a senior citizens' lounge, a daycare center, a neighborhood childcare facility, a library and 160 units of youth housing. A public parking lot with 383 spaces is also planned for two below-ground floors.
The biggest obstacle has been a sharp rise in costs as the project dragged on. Archaeological surveys that ran for roughly three years and five months starting in 2021 delayed construction, during which time building and labor costs climbed. The total project budget has nearly doubled, from 61.4 billion won ($45.9 million) to 117.8 billion won.
The financial terms of the existing project agreement have also drawn criticism. Under the current structure, Songpa-gu provides LH with the housing land at no cost, LH builds and operates the 160 youth housing units for 30 years and then transfers them to the district free of charge — while the district bears the full cost of constructing the public facilities. The district would also be responsible for maintaining the youth housing units after they are handed over.
In response, Songpa-gu reached an agreement with LH in September to restructure the project. Under the revised plan, the district would sell LH a 2,260-square-meter parcel — about 20 percent of the total site — designated for youth housing. LH would build and operate the youth housing on that land, and the district would use the proceeds from the sale to construct the public facilities at the originally planned scale.
The administrative path to getting the project back on track has not been smooth, however. The district submitted a shared-property management plan to the district council in October to authorize the land sale, but the council removed the item from the agenda without putting it to a full vote.
Songpa-gu says it cannot cover the sharply higher costs through existing reserves such as its public office fund and integrated fiscal stabilization fund, as those resources are already earmarked for other projects or future budget needs. The district also cited realistic limits on securing additional funding from the national or city government.
The district plans to make the case to the council for restructuring the project, warning that further delays would not only inconvenience residents but also increase the fiscal burden as construction costs continue to rise. It intends to resubmit the relevant proposal and push the process forward.
"The public office complex belongs to the residents of this district, and we can no longer stand by while they bear the cost of years of delays," District Mayor Seo Gang-seok said. "We will fulfill our administrative responsibility to serve residents, remove every obstacle in this project's path and do everything in our power to break ground as soon as possible to minimize the harm to our community."
seouldream01@heraldcorp.com
