Prime Location Adjacent to Seoul Forest and Hangang... The Fate of Sampyo Factory Site in Seongsu-dong

Demolition to be completed by the 16th of next month
Seoul City and Sampyo Industry deliberate on utilization plan for 28,000㎡ site

Likely to pursue zoning change for development
Possibility of preferential treatment controversy in the process

[Asia Economy Reporter Kim Hyemin] The Sampyo Remicon factory in Seongsu-dong, Seongdong-gu, Seoul?an area adjacent to ultra-luxury apartments, Seoul Forest, and the Han River, known as "golden land"?is being demolished in August, drawing attention to how the site will be utilized.

According to Seoul City and Sampyo Industrial on the 1st, Sampyo Industrial will complete the demolition of the Sampyo Remicon factory by August 16. Although the initial promise to finish demolition by June 30 was not kept, the company immediately set a new deadline, showing its determination. Issues causing delays, such as compensation negotiations with mixer truck subcontractors, have also been resolved.

The market’s interest lies in how the site will be utilized from an urban planning perspective. There is no doubt about the value of the site, which spans 27,828 square meters. Over the 45 years the factory operated, the surrounding Seongsu-dong area transformed into one of Seoul’s most vibrant commercial districts and a dense area of ultra-luxury apartments. Located at the confluence of the Han River and Jungnangcheon Stream, the site’s future utilization could enhance not only its own value but also the future value of the surrounding hub areas.

The utilization plan for this site will be decided through prior negotiations between Seoul City and Sampyo Industrial, the landowner. This is a required process when a private developer plans to develop a site larger than 5,000 square meters. Private developers can expect zoning upgrades, while local governments can secure a portion of development profits as public contributions to promote balanced development. A Seoul City official stated, "Once demolition is complete, we need to establish a district unit plan. The procedure to change urban planning will be conducted through prior negotiations, during which zoning, development density, and introduced uses will be determined."

Seoul City has already commissioned related research. Plans are being considered to develop the Sampyo Remicon factory site in connection with the Apgujeong apartment district and the Jamsil International Exchange Complex District. Earlier, Seoul Mayor Oh Se-hoon announced plans to consider this area as a strategic site to strengthen the youth advanced innovation axis and as a representative tourist attraction of Seoul linked with Seoul Forest.

The key issue is zoning changes. Currently, the Sampyo Remicon factory site in Seongsu-dong is classified as a Type 1 General Residential Area, with a maximum floor area ratio of 200%. This limits development potential for both residential and office facilities, so industry consensus suggests a high possibility of zoning changes. For example, the nearby mixed-use complex Acro Seoul Forest was developed under a General Commercial Area classification. Ultimately, the site’s value will vary depending on how Seoul City changes the zoning.

However, the industry also points out concerns about potential favoritism controversies during this process. When Seoul City initially planned direct development in 2017, plans to secure land acquisition funds by changing nearby natural green zones to residential land and selling them to the private sector sparked favoritism debates. A real estate industry official said, "Given the sensitivity heightened by the Daejang-dong favoritism controversy, this is a very delicate issue. It will likely take quite some time to finalize utilization plans as they scrutinize whether public contributions from zoning changes are sufficient."

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