[Report] Delays in Move-in and Management Fee Conflicts... Legal Disputes at Gangnam's Last Knowledge Industry Center

Gangnam's Last Knowledge Industry Center 'Exlu Prime'
Conflict Over Delayed Move-in and Interim Payment Interest Support
Residents' Collective Move-in Refusal Due to 20,000 KRW per Pyeong Management Fee Shock

The knowledge industry center 'Exlu Prime' located in Jagok-dong, Gangnam-gu, Seoul, where conflicts between the developer and the buyers have continued due to delayed move-ins, is now suffering from a controversy over exorbitant maintenance fees. The maintenance fees have been set at 3 to 4 times higher than those of other knowledge industry centers, causing buyers to refuse to move in. The developer is opposing by refusing to hand over keys unless the maintenance fee contract and management regulations are signed, leading 15 buyers to currently engage in legal litigation.

On the 4th, the first floor of Exlu Prime, visited by the reporter, was completely empty except for one real estate office that moved in first in May. Although there was a notice stating that a pharmacy and family medicine clinic were to be established, there were no units undergoing interior construction for move-in or with completed interiors. Exlu Prime is the last knowledge industry center in Gangnam, Seoul, and one of only three knowledge industry centers in Gangnam. It was supplied in June 2020 with a total of 249 units across 4 basement floors to 10 above-ground floors, with a total floor area of 43,115㎡. The sale price per 3.3㎡ was relatively high at 20 to 25 million KRW, but it attracted interest from actual users and investors, leading to full sales from the first to the fourth floors.

Axle Prime, a knowledge industry center in Jagok-dong, Gangnam-gu, Seoul. Although move-ins began on April 28, the first floor is currently completely empty except for one real estate office.

However, as conflicts between buyers and the developer escalated due to delayed move-ins and support for interim payment interest, as of the 4th, only four companies that have received keys have moved in.

Before these conflicts could be resolved, the developer's process of selecting a building management outsourcing company and the maintenance fees set by the temporary company entrusted have caused some buyers to protest, deepening the conflict.

Kim Jeong-min, the representative of Exlu Prime buyers, pointed out, "To select a management outsourcing company, the consent rate of unit owners must meet 50% and the area requirement 50%, and after appointing a manager through a general meeting, the management outsourcing company can be contracted. However, the developer is forcing agreement to the management regulations by creating a subsidiary (Smart Life) without following these legal procedures."

The temporary management group of unit owners or buyers argues that Exlu Prime is a building subject to the Act on Ownership and Management of Collective Buildings, and the management group should be formed appropriately within the legal framework. A manager should be appointed through a management group general meeting and management regulations established, but the Smart Life company appointed by the developer has bypassed this process and unilaterally created management regulations, forcing buyers to sign. The developer has notified that keys will not be handed over unless these management regulations are signed, leaving buyers unable to receive keys despite paying the balance.

The detailed management fee information stated in the Gangnam Exclooprime management contract specifies a charge of 20,000 KRW per pyeong.

Moreover, the maintenance fees proposed by Smart Life, entrusted with building management, are at a bombshell level, further escalating the conflict. According to the Exlu Prime management contract, it is specified that for efficient and smooth operation and management as a high-end advanced knowledge industry center, the maintenance fee for the relevant month will be charged on the 15th of the month based on 20,000 KRW per pyeong (excluding VAT). However, typically, knowledge industry centers use industrial electricity and have a large floating population, so their maintenance fees are cheaper than commercial buildings or other offices with high water and electricity usage. The average maintenance fee per pyeong is around 5,000 to 8,000 KRW. Even Ace Tower, a knowledge industry center located right next to Exlu Prime, charges 5,000 KRW per pyeong.

When residents protested the higher maintenance fees compared to typical knowledge industry centers, the developer explained that it was because premium services such as free valet parking for registered vehicles, free car wash for registered vehicles, and hotel-style concierge services were provided. However, residents are furious, saying that not even basic heating and cooling facilities are operational.

Park Jae-woo, who purchased a unit on the third floor and moved in that day, said, "We do not need arbitrary premium services without the consent of buyers," raising his voice, "How can they claim to provide premium services when the air conditioning was not even turned on on a day with a heatwave advisory?"

A resident on the first floor, Mr. A, lamented, "Currently, air conditioning is only operating in common areas, and trial runs for cooling equipment were conducted only today. Since the heat intensified about two weeks ago, some visitors coming for consultations have left because they could not bear the heat."

As the situation shows signs of prolongation, Gangnam District Office plans to arrange a meeting with NT Industry to discuss measures such as interest reduction. The excessive maintenance fee of 20,000 KRW per pyeong will also be corrected through negotiations with the developer. Resident B, who purchased a unit on the fourth floor, said, "Since we did not agree to the illegal regulations, we conveyed Seoul City's opinion to the developer to apply the Seoul City Standard Management Regulation Rules. Once the developer's position on interest reduction and other matters is decided, we plan to meet with the official management group representing all members to discuss these concretely."

When contacted for a statement, an NT Industry official declined, saying, "We will not give interviews to the media."

[Rebuttal Report] Regarding 「[Report] Delayed Move-in and Maintenance Fee Conflicts... Gangnam's Last Knowledge Industry Center 'Legal Dispute'」

Our newspaper reported on July 5 in the real estate section of Asia Economy Dotcom under the title 「[Report] Delayed Move-in and Maintenance Fee Conflicts... Gangnam's Last Knowledge Industry Center 'Legal Dispute'」 that conflicts over delayed move-ins, interim payment interest support, and maintenance fees of 20,000 KRW per pyeong caused buyers to collectively refuse to move in.

In response, the developer stated, "The maintenance fee of 20,000 KRW per pyeong was set to provide differentiated premium services such as free valet parking and free car wash for registered vehicles and hotel-style concierge services, so it is not appropriate to simply compare the maintenance fee amount with other knowledge industry centers. Currently, the contractor is receiving and repairing defects on site, and 27 units have completed move-in."

This report is pursuant to the mediation of the Press Arbitration Commission.

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