Up to 70% Financing at 1.5% Annual Interest Available for Remodeling Old Industrial Complex Factories

[Asia Economy Reporter Chunhee Lee] A policy loan offering long-term low-interest loans at an annual rate of 1.5% for up to 70% of the project cost will be available for remodeling old factories in aging industrial complexes.

The Ministry of Land, Infrastructure and Transport announced on the 22nd that from the 24th, applications and consultations for Housing and Urban Fund loans to support remodeling project costs for old factories within aging industrial complexes will be conducted.

This project is part of the follow-up measures to the 'Industrial Complex Grand Renovation Plan' announced last November. An investigation of six industrial complexes over 20 years old found that about half of the buildings were constructed more than 20 years ago, indicating severe aging of factories within the complexes. Considering the difficulty in securing project funds despite the need for maintenance, the government has stepped in to provide direct support.

Loan support is available to any business operator undertaking remodeling projects for old factories within regeneration project zones in aging industrial complexes. Applications and evaluations are conducted through the Housing and Urban Guarantee Corporation (HUG). A variable interest rate of 1.5% per annum applies, with a 10-year grace period, and loans can cover up to 70% of the total project cost.

Moreover, if an existing factory within the aging industrial complex regeneration project zone is partially or completely demolished and relocated to another site within the same regeneration zone, loan support is also available for land acquisition and factory construction project costs.

This year, 50 billion KRW in loans using the Housing and Urban Fund will support aging industrial complex regeneration projects. In addition to support for remodeling projects, funding has already been provided since last year for infrastructure-type projects and complex development-type projects. The loan conditions for infrastructure-type projects are the same as those for remodeling projects, while complex development-type projects offer a variable interest rate of 2.0% per annum with a 13-year grace period and loans covering up to 50% of the total project cost.

Kim Geun-oh, Director of the Industrial Location Policy Division at the Ministry of Land, Infrastructure and Transport, said, "Through the remodeling loan support project, we hope to transform the image of old and worn factories in industrial complexes, improve working environments, contribute to youth job creation, and also aid in the smart renovation of industrial complexes."

This content was produced with the assistance of AI translation services.