In-depth Analysis of the Special Act on Aging Planned Cities (Part 1)

[Redevelopment of 1st New Towns: In-depth Analysis of the Special Act on Aging Planned Cities (Part 1)]

Built in the late 1980s to solve the housing shortage, the 1st New Towns now face a new problem: aging and the difficulty of reconstruction. To solve these issues and open a sustainable future for the cities, the government enacted the 'Special Act on the Maintenance and Support of Aging Planned Cities.' In Part 1 of this article, we will help you understand the big picture of urban redevelopment by in-depth analysis of the background of the 1st New Towns and their aging issues, as well as the key contents and major incentives of the Special Act.

1st New Towns, Asking About the Future of the City: An In-depth Analysis of the Special Act on Aging Planned Cities (Part 1)

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1. The Birth of the 1st New Towns and the Vicious Cycle of Aging

In the history of urban development in South Korea, the '1st New Towns' were a groundbreaking milestone. In the late 1980s, to solve the serious housing shortage and disperse the overcrowded population of Seoul, large-scale new towns were built in five locations: Seongnam (Bundang), Goyang (Ilsan), Gunpo (Sanbon), Bucheon (Jungdong), and Anyang (Pyeongchon). They presented a new urban model with a planned residential environment and various amenities. In fact, after 1990, Seoul's population began to decrease for the first time, and this continuously had the effect of dispersing the population until 2010.

However, after more than 30 years, the 1st New Towns have faced new problems. The aging of the initial infrastructure, parking shortages, and city functions that do not align with the changes of the times have degraded the quality of life for residents. In particular, it was difficult to secure project profitability through reconstruction due to the high floor area ratio at the time of construction, making systematic urban maintenance virtually impossible with existing reconstruction regulations alone. Therefore, the government has prepared a special legal basis to solve the aging problems of the 1st New Towns and to let them be reborn as sustainable cities.

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2. Key Contents and Incentives of the Special Act on the Maintenance of Aging Planned Cities

The 'Special Act on the Maintenance and Support of Aging Planned Cities', which has been in effect since April 27, 2024, is the key legal basis for the redevelopment of the 1st New Towns. This special act defines an aging planned city as a 'district that has been completed for more than 20 years and has been created on an area of 1 million square meters or more', and provides the following exceptional benefits.

2.1. Floor Area Ratio Increase

Areas designated as special maintenance zones can be granted special provisions to raise their land use zone or to relax the floor area ratio up to 150% of the legal limit. For example, a legal basis has been prepared to significantly improve project profitability by changing a Class 2 General Residential Zone to a Class 3 General Residential Zone, or by raising it to a Quasi-Residential Zone. This is expected to contribute to reducing the burden on residents by increasing the economic viability of reconstruction projects.

2.2. Safety Diagnosis Relaxation

Safety diagnosis regulations, which were an initial stumbling block for reconstruction, can be significantly relaxed or even exempted. In particular, if only the 'obsolescence' requirement, which comprehensively determines the need for a maintenance project, is met, the way is open to skip the safety diagnosis and start the project immediately. This has laid the foundation for a dramatic increase in the speed of project promotion.

2.3. Integrated Maintenance and Complex Development

This allows for the comprehensive bundling of not just a single apartment complex but also the surrounding areas for integrated maintenance. This will have the effect of increasing the city's competitiveness by expanding infrastructure such as roads, parks, and schools, and enabling complex development that combines residential, office, and commercial functions. This special act encourages systematic urban maintenance through a master plan that encompasses the entire city.

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3. Conclusion: The Enactment of the Special Act, the Beginning of a New Urban Design

The 'Special Act on the Maintenance and Support of Aging Planned Cities' is meaningful as it is more than just a reconstruction that demolishes and rebuilds old apartments, but rather the beginning of a new urban design. The core of this special act is to secure project profitability through exceptional incentives such as floor area ratio increases and safety diagnosis relaxation, and to enhance the competitiveness of the entire city through integrated maintenance.

The enactment of this law has presented a concrete hope to the residents of the 1st New Towns, beyond mere expectations. The remaining tasks now are to select specific 'leading districts' to realize this law and to resolve realistic issues such as resident conflicts and relocation measures. In the next article, we will delve into the meaning of the leading districts selected through fierce competition, along with the tasks we must solve together in the future.

Key Summary:
The 'Special Act on Aging Planned Cities' has laid an important legal foundation for solving the chronic aging problems of the 1st New Towns and increasing urban competitiveness. It aims to revitalize reconstruction projects and achieve sustainable urban development through exceptional incentives such as floor area ratio increases, safety diagnosis relaxation, and integrated maintenance.

The contents of this blog are for reference for investment decisions only, and investment decisions should be made under the individual's judgment and responsibility. In no case can the information in this blog be used as evidence for legal liability for investment results.

▶View References◀

1. Seoul Shinmun, "1st New Town Leading Districts: A New Milestone in South Korean Urban Redevelopment"
2. Chosun Ilbo, "Bundang Saetbyeol, Ilsan Baeksong... 13 1st New Town Reconstruction Leading Districts Selected"
3. Global Economic, "Anyang City, Pyeongchon New Town Leading Districts Selected... A total of 3 districts and 5,460 households including Kkummaeul Geumho"
4. Gunpo Shinmun, "[Exclusive] Status of Agreement Rate for Each District of Sanbon Reconstruction Leading Districts - Gunpo City"
5. Bucheon Focus, "Bucheon City, 2 Jungdong 1st New Town Leading Districts Selected, Bandal A and Eunha"