Office-tel Market Restructuring... 'Small' Declines, 'Medium to Large' Rises

[Image source=Yonhap News]

[Asia Economy Reporter Cha Wanyong] Starting next year, the residential officetel market is expected to be actively reorganized around medium and large-sized units.

According to real estate R114 data on the 18th, the supply of small officetel units (exclusive area 20~40㎡) scheduled for move-in next year is 24,103 units, a 25.3% decrease compared to this year (32,305 units). In contrast, the supply of medium and large-sized units (exclusive area 60~85㎡) will increase by 23.9%, from 8,471 units this year to 10,497 units next year.

Notably, in 2024, the supply of medium and large-sized units (11,084 units) is projected to surpass that of small units (8,080 units) for the first time. This trend is expected to expand further in 2025, with medium and large-sized units (15,846 units) overwhelmingly exceeding small units (3,195 units).

The industry analyzes that the reorganization of the residential officetel market from small units mainly for single-person households to medium and large-sized units suitable for family living is due to a balloon effect caused by comprehensive apartment regulations on subscription, loans, and taxation.

Residential officetels, which are relatively free from these regulations, have emerged as substitutes for apartments, leading to an increase in medium and large-sized supply. It is also evaluated that major construction companies leveraged their brand recognition to release a large number of 84㎡ exclusive area units.

As the size of residential officetels increases, they are also showing characteristics similar to apartment layouts.

‘Hillstate Dongtan Station Centric,’ currently being sold by Hyundai Construction in the Gwangyeok Business Complex, the central business and commercial area of Dongtan 2 New Town, applies 4-bay, slab-type, and cross-ventilation structures depending on the unit type.

‘Baegunhosu Prugio Forest Morning’ built by Daewoo Construction in Uiwang Baegun Valley features a two-sided open structure, and ‘e-Pyeonhansesang City Hangdong Marina’ supplied by DL E&C attracts attention with an LDK layout integrating the living room, dining room, and kitchen.

An industry official said, “As the real estate market enters a recession, the residential officetel market is also showing signs of contraction,” and predicted, “If the economy revitalizes, the market reorganization focusing on medium and large-sized units will accelerate.”

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