HDC Hyundai Development Company announced on the 29th that each member of the association could earn an additional profit of about 850 million won in the Yongsan Maintenance Depot Zone 1 redevelopment project.
HDC Hyundai Development Company noted that it could secure an additional sales area of about 18,681 square meters (5,651 pyeong) compared to the original plan proposed by the association, which could yield additional sales revenue of about 375.5 billion won.
HDC Hyundai Development Company also proposed a solution to address the risk of unsold units due to the expansion of sales area. It was agreed to guarantee payment in kind at the higher amount of the initial general sales price or the appraisal value at the completion time in the event of unsold residential and non-residential facilities. The intention is to preemptively block the risk of increased member contributions or deterioration of project viability regardless of whether unsold units occur.
Residential facilities around Yongsan Station are highly popular, trading at over 80 million won per 3.3 square meters, but commercial facilities find it challenging to thrive, as seen with some vacancies even in the 'Yongsan Prugio Summit,' which was completed in 2017.
The Yongsan Maintenance Depot Zone 1 has a non-residential facility ratio exceeding 50%, meaning the decision to sell non-residential facilities can have a decisive impact on the project's viability.
In fact, if the non-residential facilities in the Yongsan Maintenance Depot Zone 1 are assumed to be sold at the surrounding market price, the estimated sales revenue based on the association's plan is about 2 trillion won. If 20% unsold units occur, a loss of 40 billion won will be incurred, resulting in a loss of about 910 million won per member. If unsold units increase to 30%, the loss per person rises to about 1.36 billion won.