Compensation for Dongtan New Town Estimated 6 Trillion Won

The total compensation for Second Dongtan New Town development is estimated to be around 6 trillion won – the highest among all new towns. Its total working expenses will amount to 14 trillion won, making the project the most expensive of the new towns.

On June 6, a source in the Ministry of Construction and Transportation said, “Second Dongtan New Town, to be developed in the 6.6 million pyeong land of Dongtan-myeon, Hwaseong, will exceed Bundang in size and accommodate 105,000 houses for a population of 260,000. Total expenses are estimated to be about 14 trillion won.”

As for its move to exclude the Libera Country Club, located in the middle of Second Dongtan New Town, the Ministry explained, “Compensation for the club is estimated to be more than 700 billion won, 5% of total expenses.”

Total expenses include compensation for land and expenses for foundational facilities such as roads and electric railways.

The Ministry did not reveal the total amount of compensation, but the real estate industry predicts that the percentage of compensation will be similar to that in other new towns developed in the southern metropolitan area.

The percentage of compensation in First Dongtan New Town, across Gyeongbu Highway, was 41 percent, while that in Pyeongtaek New Town amounted to 43 percent. In a similar level, compensation for Second Dongtan New Town is estimated to be 5.7 to 6 trillion won.

The percentage of compensation for land in Gwanggyo New Town located near Second Dongtan New Town was 55 percent. If the same rate is applied, compensation will increase to 7.7 trillion won.

The Ministry is pursuing an amendment to the Land Compensation Act to make it possible to compensate for land with “developed land.”

If the amendment is made as planned, the real estate industry estimates that the approximate amount of cash to be released will be 4.5 to 5 trillion won.

Second Dongtan New Town will make a record in total expenses among new towns built in the Seoul Metropolitan area.

The total amount (14 trillion won) is 10 trillion won more than Bundang New Town’s (4.16 trillion won) and 5 trillion won more than Gimpo New Town’s (9.2 trillion won).

bae2150@donga.com