Woori Financial Supports First-Generation New Town Redevelopment with KRW 480 Billion Investment

Investment in the KRW 12 Trillion “Future City Fund”

On May 7, Woori Bank announced that, together with its affiliate Woori Asset Management, it will participate as a key partner in the “Future City Fund,” which supports the redevelopment of aging planned cities, by committing KRW 480 billion to the fund.

This fund was established under the initiative of the Ministry of Land, Infrastructure and Transport to support the redevelopment of first-generation new towns such as Bundang, Ilsan, Pyeongchon, Sanbon, and Jungdong, encompassing approximately 530,000 households. The fund aims to stably supply the initial project capital required from the planning phase of the redevelopment process, thereby reducing the high-interest financing burden that has been a challenge in conventional redevelopment projects.

Woori Bank will participate as the largest investor in the first master fund of the Future City Fund project, which has a total size of KRW 12 trillion, by contributing KRW 480 billion out of the KRW 600 billion master fund. Through this, Woori Bank will supply up to KRW 20 billion in initial project capital per redevelopment site at low interest rates, in connection with guarantees provided by the Housing and Urban Guarantee Corporation (HUG). The bank has focused on strengthening the momentum of the aging new town redevelopment projects by leveraging a risk management structure based on HUG guarantees.

Woori Asset Management will be responsible for managing the fund. Since 2020, Woori Asset Management has managed HUG-guaranteed loan funds focused on redevelopment and reconstruction, amounting to approximately KRW 4.3 trillion as of the first quarter of 2026. Based on its highly regarded expertise in structured finance and crisis management accumulated through this experience, the company was selected as the manager of the first master fund. With this, Woori Asset Management plans to expand its business beyond traditional asset management into alternative investments and the policy fund market.

Currently, all investment commitments from major investors have been completed, and the fund will operate using a capital call method, with funds deployed as needed. When leading project sites for the first-generation new towns are selected and financial support is requested, actual capital deployment will proceed accordingly.

A Woori Bank representative stated, “Through our participation in the Future City Fund, we have resolved the initial funding challenges and established a stable foundation for the redevelopment of aging new towns. Going forward, we will continue to expand structured finance linked to policy finance, contributing to the soundness of the real estate project financing (PF) market and the improvement of residential environments.”

Meanwhile, Woori Bank has been strengthening its position in the housing finance sector, having arranged KRW 6.6 trillion in real estate redevelopment and reconstruction loans and provided KRW 3.4 trillion in financial support in these areas last year.

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