Kim, Oh fail to reach deal on Seoul housing supply at second meeting

Seoul mayor and land minister hold second briefing on housing supply; third meeting planned for next week

Kim draws line: Yongsan not included in 73,000-unit plan

Oh says easing redevelopment floor-area ratio would yield more units than Yongsan

Minister of Land, Infrastructure and Transport Kim Yun-deok (right) and Seoul Mayor Oh Se-hoon shake hands after meeting at a restaurant near Seoul City Hall on Wednesday to discuss housing supply options, including the use of Yongsan Park. [Yonhap]

Minister of Land, Infrastructure and Transport Kim Yun-deok and Seoul Mayor Oh Se-hoon failed to reach an agreement in their second meeting over a plan to build housing on the Yongsan Park site. The government reiterated its intention to develop youth housing on a former residential section within Yongsan Park, but Seoul's firm opposition was once again confirmed. However, the government signaled it would review Seoul's proposed alternative — the Tancheon Water Reclamation Center in Gangnam-gu — and consider easing redevelopment floor-area ratio limits, suggesting the focus of housing supply may be shifting away from Yongsan.

Land Minister Kim Yun-deok arrives at a restaurant near Seoul City Hall on Wednesday to meet with Seoul Mayor Oh Se-hoon to discuss housing supply options, including the use of Yongsan Park. [Yonhap]

Kim: Tancheon under review; Yongsan not part of 73,000-unit supply plan

After meeting with Oh near Seoul City Hall on Wednesday, Kim said the ministry would review the feasibility of housing supply at the Tancheon Water Reclamation Center — the alternative site Seoul proposed in place of Yongsan Park. "The core of the meeting was the request to review Tancheon," he said.

He stopped short of saying whether the site was suitable, adding that he would need to analyze the data before making any assessment.

Kim also made clear that Yongsan Park is not included in the government's previously announced plan to supply 73,000 housing units.

"Yongsan Park was never part of the 73,000 units from the outset," he said. "The ministry's position is, first, that the matter must go through a public deliberation process, and any housing supply there can only proceed if the Special Act on Yongsan Park is amended as a result." He added that even then, cooperation from local governments — including Seoul and Yongsan-gu — would be required.

Interior of the Tancheon Water Reclamation Center in Gangnam-gu, Seoul, seen Tuesday afternoon. [The Herald Business DB]

On the Yongsan Park housing proposal, Kim acknowledged the two sides remained far apart, saying the gap in views had not narrowed. When asked whether Gyeonggi Province was the only area included in the forthcoming 73,000-unit supply site announcement, he declined to answer.

"I will speak after further discussions," Kim said. "Since we are still consulting with Seoul, the answer will come out naturally in due course." He asked for understanding on why specific sites were not being named, saying speculative forces tend to read far too much into any single remark, which could send distorted signals. He said he was not referring to sites that had not been confirmed.

A ministry official said the 73,000-unit site plan was "largely coordinated, but not finalized," adding that details would be settled by the time of the announcement.

On the ruling party's push to give district mayors approval authority over redevelopment projects involving fewer than 500 units, Kim said the matter was not specifically discussed at the meeting. He said district offices had already made requests to Seoul, and the ministry would join the discussion as the National Assembly takes it up. "Since it has been agreed upon at the Democratic Party's party-government-administration meeting, it will likely move in that direction," he said.

Kim also sidestepped a question on whether the two sides had agreed on Seoul's longstanding demand to raise the private-sector floor-area ratio cap to 1.2 times the legal ceiling. "Discussing something and reaching the same view are two slightly different matters," he said, declining to confirm any agreement. He added that cooperation between the minister and the Seoul mayor was crucial to ensuring a large volume of housing supply in Seoul, and said he planned to meet with Oh again next week if possible.

Seoul Mayor Oh Se-hoon briefs reporters at Seoul City Hall on Wednesday after his meeting with Land Minister Kim Yun-deok on housing supply options. [Yonhap]

Oh: Easing floor-area ratio would yield more units than Yongsan

In a separate briefing after the meeting, Oh said Seoul's position remained unchanged — Yongsan Park was non-negotiable. He said he came away feeling hopeful, however, after hearing that the ministry would conduct an in-depth review of Seoul's proposal to build housing at the Tancheon Water Reclamation Center.

Oh formally proposed the Tancheon Water Reclamation Center — covering about 393,000 square meters — as an alternative to Yongsan Park, saying it could accommodate between 10,000 and 13,000 households.

Oh said the minister listened carefully to Seoul's concept for a tentatively named Southeast Youth Industry Cluster at the Tancheon site. He said the minister agreed to conduct an in-depth review, noting that a private-sector eligibility assessment would be completed by the end of this year and that funding could be secured through the sale of the Eastern Road Management Office — valued at 3.3 trillion won ($2.39 billion) — and the Seoul Trade Exhibition Center, known as SETEC, valued at 2.3 trillion won.

Yongsan-gu District Mayor Kim Gyeong-dae and local residents visit Yongsan Children's Garden. [The Herald Business DB]

Unlike Kim, who avoided giving a definitive answer, Oh expressed hope that an agreement could be reached if his proposals were accepted. "Today we again fell short of a conclusion, but I expect we can reach an agreement at the third meeting in about a week," he said. "I hope Yongsan Park is taken off the table and the Southeast Youth Industry Cluster becomes the alternative."

Oh also said the ministry had agreed to give forward-looking consideration to Seoul's request to ease redevelopment floor-area ratio limits to 1.2 times the legal ceiling. He said raising the ratio to that level would add 43,000 net new housing units.

Oh said he felt the two sides were narrowing their differences on several fronts, as the ministry appeared to be taking a more positive stance on Seoul's proposals. For Seoul, easing the floor-area ratio is a key lever for expanding the net increase in housing supply.

"Seoul's ground-breaking plan calls for 310,000 units, and raising the floor-area ratio to 1.2 times would add 43,000 more," Oh said. "That would produce far more homes than what could be built at Yongsan Park and Camp Kim combined." He noted that one condition would be the inclusion of rental housing, adding that if realized, the measure would be remembered as the most reliable source of housing supply under the Lee Jae Myung administration.

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