New International Financial Center in Kimpo

A new international financial center, a size of a city (approximately 18 million square meters), will be built up around Kimpo landfill and its vicinity. The financial center will also accommodate housing and recreation facilities.

Ministry of Construction and Transportation (MCT) announced on July 14th the development of the Kimpo landfill and its vicinity (18,000,000 m2 in total).

Under the Act of Special Economic Zoning, Kimpo landfill along with Songdo New City and Yongjong Island will be designated as special economic zone and be allowed for various tax credits and benefits.

How would it be developed = Out of the total area, 1,089,999 m2 will be for housing foreigners and their offices; 5,511,000 for housing Korean citizens and offices; 10,566,000 for golf fields and other recreation facilities; and 726,000 will be reserved for future needs.

Especially, 429,000 m2 will be earmarked as the segment for foreigners. Thereupon, skyscrapers will be built to facilitate international financial business. The area, where the houses for foreign employees will be constructed, is projected to become a Beverly Hills with less than 100 % floor space ratio and one third of the population density of Kwachun (174/ha).

In the reserved lot, branches of overseas universities and medical center will be lured.

28,000 units of housing will be constructed in the zone for Korean nationals, enough to accommodate 89,000 citizens.

The land for sports and recreation facilities will accommodate 3-4 18-hole golf courses, a large theme park (1,419,000 m2) to lure in foreign tourists. In addition, horse-racing tracks and training facilities will also be constructed.

According to the MCT’ s project plan, the total area of 18,000,000 m2 will be zoned for development purposes in the early next year; in 2006, solicitation of buyers is to be performed; in 2007, construction will start; finally from 2009, moving-in is planned to begin.

The Korea Land Corporation, the designated developer, reportedly plans to invest more than two billion won in purchasing of the land and laying foundations. But for development of foreigners’ section and theme park, foreign capital will be used.

▽Possible problems = Massive development might over-supply certain facilities, at least temporarily. According to the government’s plan, on the Yongjong Island, recreation facilities will occupy more than 7 million square meters, and in the Songdo New City, an international business center of 5.5 million square meters will be constructed. Furthermore, residences will reach almost 14,000 in number. For example, 4,500 on the Yongjong Island and 7,900 in the Songdo City

On top of that, the development of Shiwha Lake, which will be conclusively determined by the end of this year, is planned for housing and recreational purposes aiming at boosting tourism. Thus, adjustment of development schedules and methods are inevitable between localities.

Fairness is also at stake. Dong A Construction Co., which originally developed the Kimpo landfill, made out similar projects. But the government did not accept them. Therefore, in 1999, Dong A sold the rights to the projects to the government almost for nothing. Thus, if Dong A raises legal issues, its claim will undoubtedly lead to tremendous disputes.

Hyundai Construction Co., which is pushing for zoning change of Suhsan landfill and Sakumman, points out that now, the government’s objection to its plan will not sound as reasonable as before.

Jae-Seong Hwang jsonhng@donga.com