Agreement on Development of Former Gwangmyeong Youth Labor Welfare Center Site... "Submission of National Property Act Amendment to the National Assembly in the First Half of the Year"

Government Announces Legislative Notice for State Property Act and Plans to Submit to National Assembly
Increase of State Investment Limit from 30% to 50%... Encouraging Private Sector Participation

Ando-geol, 2nd Vice Minister of Strategy and Finance. (Photo by Yonhap News)

[Sejong=Asia Economy Reporter Moon Chaeseok] The Ministry of Economy and Finance announced that Vice Minister Ando-geol visited the site of the former Seoul Youth Welfare Center in Haan-dong, Gwangmyeong-si, Gyeonggi-do, which is being developed for the first time in 40 years, on the 14th. He signed a business agreement with Gwangmyeong Mayor Park Seung-won and held a meeting. The meeting was attended by Vice Minister Ahn, Mayor Park, private experts including Professor Kim Hyun-soo of Dankook University, and Namgung Young, Director of the Public Development Headquarters at Korea Asset Management Corporation (KAMCO).

The 62,301㎡ site, selected as a target for the National Property Policy Deliberation Committee in December last year, is expected to be used for various purposes such as youth startup support rather than simple housing supply. It is located 600m from Cheolsan Station and about 5km from KTX Gwangmyeong Station, close to the Seoul Digital Industrial Complex, and has the advantage of being linked to major development sites such as Gwangmyeong Station area and the 3rd New Town. The Ministry of Economy and Finance stated, "(The site) will be developed as a complex cluster for fostering future industries such as the content industry," adding, "It is expected to be an important opportunity for revitalizing the local economy and developing the southwestern metropolitan area."

The government plans to make this site a model case of collaborative development between the private sector and local governments. It will actively expand the private-local government collaboration method in the development process of national land in the future. This differs from the existing project method of entrusted development by KAMCO and Korea Land and Housing Corporation (LH). Entrusted development is a method where development is carried out with funds from the trustee such as KAMCO or LH without separate fiscal input, and investment costs are recovered through sales or rental income of the site or facilities. While it has advantages such as achieving policy goals and fiscal revenue, it has drawbacks such as limited local government participation compared to joint private-public development, causing delays in permits and consultations. It also limited private sector’s creative ideas and investment opportunities.

The government plans to utilize national land for public office complex development combining public interest facilities such as youth rental housing, living SOC, and startup support facilities through joint private-public development. Representative cases include 16 youth rental and newlywed hope housing complex developments, pilot projects for living SOC complex development such as Dobong Tax Office, and youth startup hubs in Yeoksam-dong, Seoul, and Yeonje-gu, Busan.

The government announced that it is promoting legislative amendments to revitalize private participation in national land development. The amendment is expected to include raising the state's investment limit (from 30% to 50%) and allowing in-kind contributions, enabling not only private entities but also local governments and public institutions to invest. The lease period for national land will be extended up to 50 years, and the lease fee calculation method will be made more flexible to encourage private participation. The basic plan set by the state will be reduced to minimum mandatory items, and private proposals will be encouraged during private competitions. The Ministry of Economy and Finance explained, "The amendment to the National Property Act has completed the legislative notice process and will be submitted to the National Assembly in the first half of the year after going through related procedures."

Vice Minister Ahn said, "By next year, we will finalize the land development plan for the former Youth Welfare Center site and actively proceed with procedures such as development permits, land formation, and private participation competitions," adding, "Through this business agreement, we promised close cooperation with Gwangmyeong City," emphasizing, "Since this project is promoted as a private-local government collaborative national land development method, it will be an opportunity to create a landmark in the region."

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