Outcomes diverge sharply depending on project viability

Owners of existing 36-pyeong units choosing new 84-sq-m apartments to receive about 860 million won back

244-sq-m penthouse pre-sale price set at 14.15 billion won

A view of Jamsil Jugong Apartment Complex 5 in Songpa-gu, Seoul. [Yonhap]
A view of Jamsil Jugong Apartment Complex 5 in Songpa-gu, Seoul. [Yonhap]

Members of the Jamsil Jugong Apartment Complex 5 reconstruction cooperative in Songpa-gu, Seoul, who choose a new apartment of roughly the same size as their existing unit are estimated to receive hundreds of millions of won back. Those who opt for larger units face sharply rising additional contributions — with the most expensive penthouse units carrying a bill of more than 10 billion won ($7.35 million).

According to industry sources Wednesday, the cooperative has been accepting pre-sale applications from members from Tuesday through Oct. 31. Based on a design that received project implementation plan approval in July, the cooperative calculated estimated pre-sale prices and projected contributions by unit type and notified members accordingly. The reconstructed complex is planned to rise up to 65 stories.

According to the notice, the average assessed value of existing units with exclusive use areas of 76 square meters (34-pyeong), 81 square meters (35-pyeong) and 82 square meters (36-pyeong) stands at 3.91 billion won, 4.04 billion won and 4.31 billion won, respectively. Assuming a normal allocation of pool and tennis court shares and applying an estimated proportional ratio of 89.24 percent, the corresponding rights values were calculated at 3.54 billion won, 3.66 billion won and 3.89 billion won.

Under this structure, members who choose a new apartment of comparable size to their existing unit would actually receive a substantial refund. The average cooperative pre-sale price for a new 84-square-meter unit in a third-class general residential zone is about 3.03 billion won. Owners of existing 34-pyeong units who choose an 84-square-meter apartment are estimated to receive back about 507.29 million won; those in 35-pyeong units, about 630.77 million won; and those in 36-pyeong units, about 860.54 million won.

The figures stand in contrast to those at Eunma Apartment in Gangnam-gu, where cooperative pre-sale applications opened Sept. 23. At Eunma, a member holding an existing 84-square-meter unit who selects a new 84-square-meter apartment must pay an additional 430.21 million won. The estimated proportional ratios also differ — 89.24 percent at Jamsil Jugong 5 versus 82.19 percent at Eunma.

Choosing a smaller unit type yields an even larger refund. The average cooperative pre-sale price for a 39-square-meter unit is about 1.51 billion won, meaning owners of existing 34-pyeong, 35-pyeong and 36-pyeong units would receive back about 2.03 billion won, 2.15 billion won and 2.38 billion won, respectively. Even for a 59-square-meter unit, the estimated refunds for existing 34-, 35- and 36-pyeong owners come to about 1.19 billion won, 1.31 billion won and 1.54 billion won.

Once members move up to larger unit types, however, additional contributions kick in. An existing 34-pyeong owner choosing a 100-square-meter unit would owe about 208.29 million won extra, and one choosing a 107-square-meter unit would owe about 541.96 million won. For existing 35-pyeong owners, the additional burden is about 84.82 million won for a 100-square-meter unit and about 418.49 million won for a 107-square-meter unit. Existing 36-pyeong owners would still receive a refund of about 144.95 million won if they choose a 100-square-meter unit, but would owe about 188.72 million won extra if they step up to 107 square meters.

For large unit types, contribution amounts jump into the billions of won. Members choosing a 152-square-meter unit face estimated contributions of about 2.11 billion won for existing 34-pyeong owners, 1.99 billion won for 35-pyeong owners and 1.76 billion won for 36-pyeong owners.

Penthouses carry contributions in the tens of billions of won. Under the current approved project design, there are 20 penthouse units in total, spanning exclusive use areas of 176, 200, 236 and 244 square meters. The third-class general residential zone will include six 176-square-meter units, six 200-square-meter units and two 244-square-meter units, while the quasi-residential zone will have two 176-square-meter units, two 236-square-meter units and two 244-square-meter units.

Among all unit types, the highest estimated cooperative pre-sale price belongs to a single 244-square-meter Type B penthouse, priced at 14.94 billion won. The 176-square-meter penthouses are estimated at about 8.58 billion won to 8.79 billion won depending on type, while the 200-square-meter penthouse is priced at about 9.67 billion won.

Through reconstruction, Jamsil Jugong 5 is set to grow from its current 3,930 units to a total of 6,411 units. Under the approved project implementation plan, 4,942 units will be built in the third-class general residential zone and 1,469 in the quasi-residential zone, including 831 rental housing units. The cooperative currently estimates that 1,534 units will be offered in the general public pre-sale, all of which will be 84 square meters or smaller.

Revenue from the general public pre-sale is estimated at about 4.47 trillion won. The average estimated general pre-sale price for an 84-square-meter unit in the third-class general residential zone is about 3.38 billion won. However, the number of units available for general sale may change depending on the outcome of the current cooperative pre-sale applications, and actual pre-sale prices will be determined after review under the price ceiling on new apartments.

The cooperative applied an estimated proportional ratio of 89.24 percent in its project viability calculations. Total project costs, excluding relocation financing expenses, are estimated at about 6.38 trillion won — a figure derived from projected revenues including cooperative pre-sale proceeds, general pre-sale proceeds and rental housing sale proceeds.

Jamsil Jugong 5 is one of the most prominent aging large-scale complexes in the Jamsil area, completed in 1978. It entered the reconstruction process in 2003 when a preparatory committee received approval, and the cooperative itself was formally established in 2013. The project continued over many years through revisions to the redevelopment plan and various review procedures. In July, it received project implementation plan approval, triggering follow-up steps toward drawing up a management and disposal plan. More than two decades after the preparatory committee was approved, the long-running reconstruction project is now approaching the relocation stage in earnest.

The figures disclosed are not final contribution amounts. The cooperative noted in its notice that the amounts are estimates based on the currently approved project implementation design and may change during the management and disposal planning process depending on future general pre-sale revenues, redevelopment costs, appraisal values and design revisions. After the current pre-sale application period, Jamsil Jugong 5 plans to discuss an alternative design with its contractor, revise the design accordingly, and then conduct another round of cooperative pre-sale applications during the relocation and demolition phase.


quq@heraldcorp.com