The industrial zones in Yeongdeungpo, Guro, and Geumcheon are gaining attention as potential housing supply areas following the housing supply measures announced on August 13. The Seoul city government has increased the maximum floor area ratio to 400%, while the national government has reduced the mandatory industrial facility ratio to 30%, enhancing the incentives for development. However, challenges such as relocating existing factories and tenants, as well as addressing transportation and infrastructure issues, remain significant hurdles.
As of now, the industrial zones in Seoul cover a total area of 19.97 square kilometers, accounting for 3.3% of the city's total area, with over 80% concentrated in the southwestern regions, including Yeongdeungpo, Guro, and Geumcheon. These zones are designated to accommodate industrial functions alongside residential, commercial, and office uses.
Historically, these industrial areas have been considered for housing supply. The Seoul city government proposed comprehensive development plans in 2009 and revitalization strategies in 2015, but faced difficulties due to the mixed-use of industrial and residential facilities and complex land ownership issues.
In 2024, the city plans to establish a district unit plan for the construction of multi-family housing, raising the maximum floor area ratio in industrial zones from the previous 250% to 400%. Currently, approximately 27,000 housing units are being planned through urban development projects in 32 industrial zones across Seoul.
The August 13 measures also revised regulations on industrial facilities. The government has lowered the minimum required ratio of industrial facilities in innovation zones from 50% to 30%, aiming to reduce the burden of industrial facilities and increase the viability of residential and commercial developments.
Additionally, the government is pursuing a plan to acquire idle land and public properties within industrial zones for direct development. There are 21 sites in Seoul that could qualify as innovation zones, each over 10,000 square meters, including the former Daeseong Flour Mill site in Mullae-dong, which spans approximately 19,000 square meters.
However, easing regulations does not guarantee an immediate increase in housing supply. Many operational factories and industrial facilities remain, necessitating solutions for the relocation and compensation of landowners, factory owners, and tenants.
Maintaining industrial functions is also a concern. Lowering the ratio of industrial facilities to facilitate housing supply could weaken job opportunities and the industrial base if these zones are effectively converted into residential areas.
Professor Ma Gang-rae from Chung-Ang University’s Department of Urban Planning and Real Estate stated, “To achieve urban mixed-use development, it is necessary to incorporate knowledge industry centers that provide job functions,” but noted that the current economic downturn poses challenges for such centers.
Transportation and infrastructure issues also persist. The introduction of large-scale housing developments could exacerbate existing traffic burdens in the southwestern region. Ultimately, while the regulations on floor area ratio and industrial facility ratios have been relaxed, achieving actual housing supply will require balancing stakeholder interests, maintaining industrial functions, and enhancing infrastructure.
Song Seung-hyun, head of the Urban and Economy Institute, remarked, “The southwestern region has lower land prices compared to other areas, and there is a pressing need to develop aging industrial zones, which could lead to significant housing supply. However, since there are people who rely on these businesses, compensation agreements are necessary, and given the existing traffic congestion, a clear plan for mixed-use development that combines residential, commercial, and industrial spaces, along with infrastructure improvements, is essential.”
* This article has been translated by AI.
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