Koramco and KB Join Forces to Successfully Rebuild Sinwol Siyeong
Published 23 May.2023 08:33(KST)
Shinwol Siyoung, a major reconstruction project in western Seoul... reborn as a large complex with 3,200 households
Koramco Asset Trust announced on the 23rd that it has signed a tripartite business agreement with the Sinwol Siyoung Apartment Reconstruction Promotion Preparation Committee and KB Real Estate Trust to successfully promote the trust-type reconstruction of Sinwol Siyoung Apartment.
The business agreement ceremony held at the KB Real Estate Trust main conference room in Yeoksam-dong, Seoul, was attended by Kim Si-young, chairman of the Sinwol Siyoung Apartment Reconstruction Promotion Preparation Committee, Jang Soon-seo, head of the Maintenance Project Headquarters at Koramco Asset Trust, Im Kang-seok, head of the Urban Maintenance Project Headquarters at KB Real Estate Trust, and many key executives related to the project.
Located at 987-1 Sinwol-dong, Yangcheon-gu, Seoul, Sinwol Siyoung is a large-scale apartment complex with a total of 2,256 households, marking its 36th year since completion in 1988. In a survey conducted in February asking residents about the reconstruction method, an impressive 91.8% expressed their preference for trust-type reconstruction, drawing significant attention.
The Koramco-KB consortium plans to transform Sinwol Siyoung Apartment, which currently has a floor area ratio of 132% and 2,256 households, into a landmark residential complex in western Seoul with a floor area ratio of approximately 250%, a total of 3,200 households, and various auxiliary facilities.
The trust-type maintenance project is a maintenance project method where a real estate trust company with expertise and public interest leads the implementation of reconstruction and redevelopment projects. It can prevent project delays caused by internal conflicts within associations and enables smooth financing through the trust company's own funds or credit enhancement, allowing for rapid project advancement.
Additionally, from the perspective of construction companies responsible for building, since the project is conducted under the responsibility of the trust company, there is no need to worry about non-construction-related tasks such as permits, sales, and financing, which can improve construction efficiency. For this reason, since the Dunchon Jugong incident last year, trust-type maintenance projects have established themselves as a new alternative replacing the existing association method.
Koramco Asset Trust recorded the highest sales among domestic real estate trust companies last year and is also the number one REIT management company in the private REIT market, managing real estate assets worth approximately 28 trillion KRW. It holds the highest credit rating in Korea with a corporate credit rating of A from NICE Credit Rating Service and has a capital of 492.7 billion KRW, exceeding the average capital of 14 domestic trust companies by about 100 billion KRW.
Koramco Asset Trust has created numerous success cases by consecutively completing several sites, starting with the reconstruction of Anyang Hogye, Silla, and Seonggwang Apartments?the first trust-type maintenance project in Korea?completed 40 months after the agent selection, followed by redevelopment projects such as Songnim 5 District in Incheon, Mojong 1 in Asan, and Gaehwasan Station area redevelopment in Seoul.
Jang Soon-seo, head of the Maintenance Project Headquarters at Koramco Asset Trust, said, “Koramco, which has many successful cases of trust-type projects, and KB, which has extensive experience in large-scale maintenance projects, will create definite synergy through collaboration. The ultimate goal is to increase the speed and efficiency of the Sinwol Siyoung reconstruction project while dispersing risks for the householders.”