The city of Busan has announced that it is offering drastically reduced sale prices and extended payment deadlines for the development of the Saha-gu’s Dadae Incinerator site, which is one of the city’s long-term development projects. The sale of the site, which was auctioned twice last year but was unsuccessful, will be closely watched.
The Dadae Incinerator site has been appraised at 30.3 billion won in 2018, but it rose to 42.47 billion won in April last year. The appraised value has increased by more than 40% in four years. In response to the unsuccessful bids in 2021, the city has cut the sale price by 10% to 38.25 billion won and extended the payment deadline by more than 300 days. The buyer must pay a down payment of 10% of the sale price, followed by 10% within six months and the remaining 80% within one year.
The development of the Dadae Incinerator site is expected to be more attractive to foreign investors as the city is also planning the development of a 550,000 m² semi-industrial area east of Dadaepo Beach as a waterfront tourism area with a combination of tourism, culture, recreation, and leisure functions. It is common for investments to be made in advance of a project’s completion in order to secure funding and resources needed for its development.
The long-degraded Dadaepo coastal area in Busan will be reborn as a large-scale tourism and recreation destination. The development of Dadaepo Coast is expected to become a new axis that will lead the development of tourism in Western Busan.
The city’s new relaxed conditions for the sale of the Dadae Incinerator site are expected to attract more investors and boost the local economy. The city plans to attract a global hotel and complex cultural space to the site and foster it as a tourist base facility in the West Busan area connected to Dadaepo Beach.
Several real estate developers have already shown interest in the project by visiting the site or inquiring about it, but there are negative observations that few investors are willing to buy in the face of high interest rates and a frozen real estate market. Therefore, the city’s new relaxed conditions are expected to attract more investors and boost the local economy.
The project can be built as a resort hotel or a hotel-condo combination. The buyer must break ground within two years from the date the business plan is approved and complete construction within five years. After completion, the building must be used for tourist accommodation for 10 years.
