The government is advocating for the conversion of non-residential facilities, such as knowledge industry centers, into housing, emphasizing the need to actively utilize residential lodging facilities (생숙) to address housing supply issues. Although these facilities are equipped with cooking amenities and resemble residential structures, transitioning them into officetels requires overcoming challenges related to parking, safety standards, and financial burdens.
According to the real estate industry on September 29, there are calls to supplement short-term housing supply by utilizing existing residential lodging facilities, as this could require less renovation compared to knowledge industry centers that need new kitchen installations.
Yoo Seon-jong, a professor at Konkuk University’s Department of Real Estate, stated, “Residential lodging facilities that were originally designed to resemble residential buildings are not being utilized due to government regulations. If we can use existing residential lodging facilities as part of the non-apartment housing supply strategy, we can provide housing without undergoing large-scale renovations like those required for knowledge industry centers.”
According to data from the Ministry of Land, Infrastructure and Transport, as of the end of June last year, there were 185,000 residential lodging units nationwide, including those under construction. Of the 141,000 completed units, 43,000 had not been registered for lodging business or converted to officetel use. However, not all residential lodging facilities can be immediately considered for housing conversion.
During the real estate market boom from 2020 to 2021, residential lodging facilities saw a surge in demand as an alternative to apartments. However, since they are legally classified as lodging facilities, using them for residential purposes without proper conversion can lead to corrective orders and fines.
The government has also announced plans to support the legal use of residential lodging facilities by October 2024, aiming to lower conversion barriers. This includes addressing parking issues through external parking arrangements and financial contributions, as well as relaxing corridor width standards if fire safety and evacuation performance are improved.
Last year, guidelines were established to ease corridor width requirements related to fire safety reviews. Additionally, a grace period until the end of 2027 was granted for those who met the requirements for lodging business registration or conversion applications by the end of September last year, delaying the initiation of fines.
There have been actual conversion cases, such as the approval by Hwaseong City in June for the conversion of 134 units at the ‘Byeongjeom Station Unam Firstville Suite’ to officetel use. The city explained that this approval would allow for legal use following subsequent approval procedures.
The key issue remains the conversion conditions for individual facilities. Even with cooking facilities, additional costs may arise for securing parking spaces and enhancing safety equipment. There are also concerns that, given the relaxed building standards under which these facilities were supplied, conversion costs should be fairly distributed among existing owners.
Lee Eun-hyung, a researcher at the Korea Construction Policy Institute, pointed out that while converting residential lodging facilities can help with short-term supply, it should not be viewed as a fundamental housing supply solution. He suggested that during the conversion process, it is necessary to enhance safety-related facilities such as fire safety, and for issues like parking that are difficult to resolve, alternative solutions such as donations or contributions should be considered.
* This article has been translated by AI.
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