![Apartment complexes seen from Lotte World Tower in Songpa District, Seoul. [Photo=Yonhap]](https://image.ajunews.com/content/image/2026/04/21/20260421145726687995.jpg)
Rising construction costs and weaker profitability are pushing South Korean builders to avoid aggressive bidding and instead pursue “selective” wins, reshaping Seoul’s redevelopment market around solo bids. Against that backdrop, DL E&C has effectively secured the first builder’s contract in the Mokdong redevelopment area by emerging as the only bidder for the Mokdong New Town Complex 6 reconstruction project.
According to the redevelopment industry on Monday, DL E&C was the sole participant in the second round of bidding to select a builder for the project in Seoul’s Yangcheon District, which closed at 2 p.m. With no rival bidder again after the first round on April 10, the process has effectively moved toward a negotiated contract.
Under the Urban and Residential Environment Improvement Act, if a second round also draws only one bidder, the association may choose the builder through a negotiated contract. The Mokdong 6 association is expected to sign with DL E&C after a general meeting in late June. The complex is considered the fastest-moving among Mokdong New Town’s 14 complexes and is viewed as a starting point for a large-scale reconstruction program totaling 26,000 households and about 30 trillion won in project costs.
This year’s Seoul redevelopment market is expected to reach a record scale as major projects move to select builders, but analysts say the trend is shifting away from the intense bidding wars of the past and toward solo bids.
Recent projects have followed that pattern. Samsung C&T was selected on April 11 as the builder for the Daechi Ssangyong 1 reconstruction project in Seoul’s Gangnam District after bidding alone. POSCO E&C also secured the Singil Station-area redevelopment project as the sole bidder. Other projects decided through solo bids include Songpa Hanyang 2 reconstruction (GS Engineering & Construction), Singil District 1 public redevelopment (Hyundai Engineering & Construction) and Geumho District 21 redevelopment (Lotte Engineering & Construction).
Industry officials attribute the shift to higher costs and heavier financing burdens. With materials and labor costs rising, project budgets have surged, while project financing pressure and unsold-unit risk have made returns harder to predict. Companies also face added expenses for design proposals, financing terms and promotional campaigns, making profitability worse as competition intensifies.
As a result, builders are increasingly concentrating on projects where returns appear secure rather than pursuing contracts at any cost.
GS E&C has won the Songpa Hanyang 2 and Gaepo Wooseong 6 reconstruction projects this year and is seeking additional contracts, including Seongsu Strategic Redevelopment Zone District 1 and Seocho Jinheung Apartments.
Hyundai E&C has identified Apgujeong Districts 3 and 5, Mokdong reconstruction complexes and the Seobinggo Shindonga Apartments in Yongsan District as key targets. “We are working to win only core projects,” a Hyundai E&C official said.
Lotte E&C is focusing its efforts on Seongsu District 4 while reviewing participation in projects with strong business prospects, including in Mokdong and Macheon in Songpa District. “We are pursuing selective bidding centered on sites where projects can proceed stably, considering the entire process from bidding through sales and move-in,” a Lotte E&C official said.
DL E&C is also watching major sites including Apgujeong District 5, Mokdong 6, Seongsu District 2 and Yeouido. “We are maintaining a selective bidding stance centered on profitability,” a DL E&C official said.
Competition, however, has not disappeared everywhere. In high-profile areas such as Apgujeong, Yeouido, Mokdong and Seongsu, major builders are still expected to clash. In a recent bid to select a builder for Apgujeong District 5 reconstruction, the process was halted after an employee of a construction company was caught taking unauthorized photos of bid documents, highlighting side effects of overheated competition. The association’s project has since been reorganized and normalized.
Overall, this year’s bidding is expected to show “low-intensity competition” dominated by solo bids, while “selective showdowns” continue in a handful of prime districts. Lee Tae-hee, a researcher with a doctorate, said the growing volume of Seoul redevelopment projects has reduced the need for loss-leading competition and that overly aggressive terms can become sunk costs. He added that for symbolic projects such as Apgujeong, companies believe being shut out of bidding could narrow their standing in the market.
* This article has been translated by AI.
Copyright ⓒ Aju Press All rights reserved.