Posted on : Apr.5,2006 02:10 KST

There are serious allegations about an improper relationship between the city of Seongnam, real estate developers, and investors in the course of the development of a major residential area in the "Industrial Area Number One" site there in Seongnam. The area is prime central downtown real estate, meaning massive profits if developed, but one particular development company bought all the land up and then the city actively worked on its behalf to have the zoning changed. The city and the developer say it was all legitimate, but there are circumstances that make you wonder.

For starters, it is strange how the developer paid twice the going price for land he had no sure reason to think would ever get rezoned. He tried on earlier occasions to have the zoning changed, but he kept having his business plans returned to him unapproved. The Military Mutual Aid Association invested W240 billion. Even before the zoning change was officially set in motion you saw open advertisements for apartments and shopping mall that was to be built. It was all a risk unthinkable without being confident about what was going to happen or without certain promises. Immediately after the developer produced his development plans the city found an alternative site for the industrial complex, and it rushed to change the zoning even before the commission responsible for oversight of development in the greater capital region had finished discussing the move. The excuse is that it was just a matter of course the plan to move the industrial zone would be approved, and that's just dumbfounding.

These allegations are in various ways similar to the "Parkview special favors" affair several years ago in the Baekgung and Jeongja parts of Bundang. It turned out that Gyeonggi province, Seongnam city, and big influential names in national politics and business were in bed with the developer. When real estate investors and developers profit by the hundreds of billion through illegal lobbying and special favors, it is regular homeowners who pay the price. The prosecution needs to dig deep and uncover not only this latest case of rezoning but illegal connections in the whole of the development industry.

The Hankyoreh, 5 April 2006.


[Translations by Seoul Selection]

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