Table of Contents
- Results of Busan's Aging Urban Regeneration Phase 1 Selection, 32,000 Units Submitted
- Urban Restructuring Focused on Haeundae and Hwamyung, Recovery of Urban Functions through Mid-rise Reconstruction
- 5.7 Times Competition Rate in Leading Areas, 77% Resident Agreement Rate Indicates High Participation
- Expectations for Improved Project Viability through Floor Area Ratio and Public Contribution Easing
- Investment Outlook: Core Areas in Haeundae and Hwamyung, Potential for Medium to Long-term Value Increase
- Conclusion: A Starting Point for Nationwide Aging Urban Regeneration, Change Initiated in Busan
- Frequently Asked Questions (FAQ)
Results of Busan's Aging Urban Regeneration Phase 1 Selection, 32,000 Units Submitted
The first phase of Busan's aging urban regeneration project selection has concluded with great enthusiasm. A total of 14 districts, approximately 32,000 units, were submitted in Haeundae Districts 1 and 2 and the Hwamyung·Geumgok district, recording an average competition rate of 5.7 to 1.
This selection process was conducted over 5 days from October 13 to 17, with 14,000 units submitted across 6 areas in Hwamyung Geumgok and 18,000 units in 8 areas in Haeundae Districts 1 and 2.
Busan City plans to conduct evaluations in October and November and finalize the leading areas in December. Selected regions will be designated as special maintenance zones, allowing for immediate commencement of maintenance planning. This is expected to lead to development and regeneration in those areas.
Urban Restructuring Focused on Haeundae and Hwamyung, Recovery of Urban Functions through Mid-rise Reconstruction
This selection is the first phase of the Basic Plan for Aging Urban Regeneration drafted by Busan City.
The Haeundae Green City, consisting of Haeundae Districts 1 and 2, aims for a new city restructuring centered around Jangsan Station. This area promotes the vision of a "sustainable composite city, 15-minute living zone, and smart mobility city," planning to reorganize structures focusing on mid-rise reconstruction.
Moreover, the Hwamyung·Geumgok district aims for eco-friendly maintenance incorporating forests and rivers as its vision, promoting green renovation that connects Hwamyungcheon and Nakdonggang. This project is characterized by shifting from individual reconstruction methods to an integrated restructuring approach that simultaneously improves infrastructure, green spaces, and transportation systems.
Such projects are expected to brighten Busan's future and contribute to creating a more livable environment for residents.
| Hwamyung·Geumgok District Submission Results | ||||
| Category | District Number | Project Name | Number of Units | Remarks |
| Hwamyung·Geumgok | 6 | Byeoksan Riverside Town, Gyeongnam Honesty Village, Hwamyung Green | 2,014 | |
| 8 | Hwamyung Green Phase 1 and 2, Hwamyung Kolon, Green Forest | 2,460 | ||
| 9 | Hwamyung-dong Lotte Nakhchondae, Daewoo Ian | 2,939 | ||
| 12 | Kolon Hanulchae Phase 1 and 2 | 2,624 | ||
| 13 | Hyundai Phase 2, Daelim Ssangyong Riverside Town | 2,638 | ||
| 14 | Sujeong Riverside Town | 1,780 | ||
5.7 Times Competition Rate in Leading Areas, 77% Resident Agreement Rate Indicates High Participation
Busan citizens showed a strong willingness to participate in this selection.
In the Hwamyung·Geumgok district, about 14,000 units were applied for 2,500 selected units, resulting in a high competition rate of 5.76 times, while in Haeundae Districts 1 and 2, 18,000 units were applied for 3,200 units, recording a competition rate of 5.63 times.
The resident agreement rate reached an average of 77%, indicating a high level of voluntary participation in many complexes.
Busan City is currently forming an evaluation committee for the selection of leading areas and is evaluating based on residents' participation, urgency of maintenance, and potential project impact, with final results to be announced in December.
| Results of Haeundae District 1·2 Submission | ||||
| Category | District Number | Project Name | Number of Units | Remarks |
| Haeundae | 2 | Doosan Phase 1, LG, Daelim Phase 1 | 4,694 | |
| 3 | Samsung, LIG Gunyoung, Dongbu, Lotte Phase 4, Dongsin | 3,713 | ||
| 6 | Lotte Phase 3, Gunyoung Phase 2 | 1,762 | ||
| 7 | Dongwon Duke Village (1~3) phase | 260 | ||
| 8 | Shinseong, Daechang, Kolon, Hanil | 2,254 | ||
| 9 | Daewon, Hwamak Town | 1,348 | ||
| 10 | Halla, Byeoksan Phase 1, Doosan Phase 2 | 1,978 | ||
| 11 | Daewoo Phase 2, Byeoksan Phase 2 | 2,072 | ||
Expectations for Improved Project Viability through Floor Area Ratio and Public Contribution Easing
Busan City has recently announced its Basic Plan for Aging Urban Regeneration, deciding to raise the floor area ratio and ease public contribution to enhance the viability of reconstruction projects.
In particular, the average floor area ratio for the Hwamyung·Geumgok district is set at 350%, while Haeundae Districts 1 and 2 are increased to 360% from the general residential area. For example, if the floor area ratio of Hwamak Town in Haeundae is adjusted from the current 260% to 360%, approximately 345 additional units can be supplied. This allows for about 310 units to be available for general sale, excluding public contributions.
Such changes are expected to positively impact reducing the expenses for union members and enhancing the project's profitability. This plan by Busan City is anticipated to be a significant impetus for revitalizing the reconstruction market.
Busan City implemented a new ordinance last May to adjust the public contribution ratio to the legal minimum of 10% for the first section and 41% for the second section. This change aims to alleviate the burden during the project execution and enhance community acceptance.
As a result, reconstruction is expected to be activated in the future, positively influencing regional development.
For detailed information about the 2035 Busan Metropolitan City Aging Urban Regeneration Basic Plan for Haeundae and Hwamyung, please refer to the postings below.
Investment Outlook: Core Areas in Haeundae and Hwamyung, Potential for Medium to Long-term Value Increase
Once designated as leading areas, a special maintenance plan will be quickly established, accelerating development.
Specifically, areas surrounding Jangsan Station in Haeundae, the central axis of Jwadong, and the riverside apartment belt in Hwamyung are expected to see increases in real estate value in the medium to long term due to locational advantages and infrastructure improvements.
However, rising construction costs, interest rate increases, HUG guarantee regulations, and issues in securing relocation costs remain variables.
Therefore, future investors need to thoroughly review whether an area is chosen as a leading area, the ratios of public contribution applied by floor area ratio, and the schedule for establishment of unions.
Conclusion: A Starting Point for Nationwide Aging Urban Regeneration, Change Initiated in Busan
The selection of leading areas for Busan's aging urban regeneration project goes beyond local significance; it marks the first stage of the nationwide ‘Aging Urban Regeneration Leading Project’. Through Haeundae Districts 1 and 2 and the Hwamyung·Geumgok district, Busan is demonstrating the recovery of urban functions and the feasibility of mid-rise reconstruction models, establishing itself as a representative city.
Such projects are expected to be a critical turning point brightening Busan's future. As a model case for urban regeneration, it holds great potential to positively influence other regions.
Increases in construction and project costs, rising financial costs, and regulation on sale prices continue to act as risk factors. Due to uncertainties surrounding the speed and profitability of reconstruction, one should avoid unconditional optimism. It is crucial to approach cautiously after thoroughly analyzing the project structure and market environment. In Busan, there are several projects that have completed demolition but have not yet begun construction.
Short-term, strategies targeting price appreciation due to the designation of leading areas may prove effective. Particularly, for property owners with long-held real estate, the current timing may be advantageous for selling. However, from a long-term perspective, a conservative investment judgment that comprehensively considers public contribution burdens, relocation and construction cost risks, high contribution fees, and interest rates is necessary.
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Frequently Asked Questions (FAQ)
Q. How many units were submitted for the first phase of Busan's aging urban regeneration project?
Approximately 32,000 units were submitted for Busan's Aging Urban Regeneration Phase 1.
In the Phase 1 selection of Busan's aging urban regeneration project, about 32,000 units were applied from a total of 14 districts in Haeundae Districts 1 and 2 and Hwamyung·Geumgok, with an average competition rate of 5.7 to 1. In Hwamyung·Geumgok, 14,000 units were applied across 6 areas, while 18,000 units were involved in Haeundae Districts 1 and 2 from 8 areas.
Q. What is the main vision of the Busan Aging Urban Regeneration Leading Area project?
Haeundae aims for a smart mobility new city, while Hwamyung·Geumgok focuses on eco-friendly integrated maintenance.
Haeundae Districts 1 and 2 aim for "sustainable composite city" and "15-minute living zone" with a focus on mid-rise reconstruction around Jangsan Station. In contrast, the Hwamyung·Geumgok district emphasizes eco-friendly maintenance connecting Hwamyungcheon and Nakdonggang with the vision of "a human-centric city with forests and rivers," improving infrastructure, greenery, and transportation simultaneously through an integrated reconstruction model.
Q. How has Busan improved its floor area ratio and public contribution policies?
The floor area ratio was raised and the public contribution ratio was eased to enhance project viability.
Busan has adjusted the average floor area ratio for the Hwamyung·Geumgok district to 350% and to 360% for Haeundae Districts 1 and 2 in the Basic Plan for Aging Urban Regeneration. Additionally, a recent ordinance lowered the public contribution ratio to the legal minimums of 10% for the first section and 41% for the second section, increasing project viability and community acceptance, and it is expected to reduce union contributions and expand general sales.
Q. What is the investment outlook for the Busan Aging Urban Regeneration Leading Areas?
Long-term value increases in real estate in the core areas of Haeundae and Hwamyung are expected.
After designation as leading areas, accelerated development will occur through special maintenance plans, with expectations for long-term value increases in real estate due to advantages in location and infrastructure improvements, especially around Jangsan Station and the riverside apartment belt in Hwamyung. However, rising construction costs, interest rate hikes, and guarantee regulations present risks, necessitating thorough consideration of the conditions for leading area selection and the application of floor area ratios and public contributions.
Q. What is the national significance of this project and Busan's role?
The Busan Leading Area project is crucial as the first stage of the national aging urban regeneration efforts.
The Phase 1 project of Busan's aging urban regeneration demonstrates the feasibility of mid-rise reconstruction models and the recovery of urban functions through the Hwamyung·Geumgok and Haeundae Districts 1 and 2, acting as a signal for nationwide regeneration projects. It positions Busan as a model case for urban regeneration that is expected to positively influence other regions.