On Jan. 22, there was a judicial decision made by the Seoul Administration Court about the New Town Project (NTP). The landlords's union approved by Seongdong-gu office was managing the redevelopment project in the first district of Wangsimni. However, the court decided that its project is invalid and it must be broken up. "The reason why the judges decided the union invalid is that the union manipulated residents's agreements. Illegal acts and methods were used during the removal of people from the area," Lee Ju-won, the Chief and human rights activist of Sharing and Future, said.
According to a chart beside, landlords should make their union, and get the government's approval for starting construction. Following these proceedings, The Seoul Administration Court decided to cancel the approval of the government; landowners had to remake their union, although over 90 percent of the removal operation was done in the first district. Experts expected that the court? decision will influence different districts?redevelopment project.
Like Wangsimni? case, some victims of redevelopment have brought the suit against the landlords for violating their rights. However, the problem is related to over 800,000 citizens. According to the removal plan, tenants in over 600 areas will have to move out and their future is in limbo. On the sites of NTP, tenants who should leave their towns are burying under the landlords' personal benefits and the unresponsive government.
Tenants Are Crying
Lee Myung-bak, the former mayor of Seoul city, enacted the new redevelopment policy in 2002. The idea of the NTP is to promote the public interest by putting together the areas which are making slow progress. However, controversies are deepening between tenant-merchants and landlord unions. In Korea, there is a deal that the new renter should give key money to the existing renter for the transaction to occur. But this key money does not involve any printed contract. It is a private deal. So there is no way that renters can compensate for the key money legally and they only receive the amount of loss for four months from the government.
One of the typical examples is the Yongsan Tragedy. In Yongsan, key money between the renters was over 100 million won on average. It was because that area was a promising marketplace. Renters feel shocked that they lost their workplace and the large amount of key money. "In many industrial complexes before the redevelopment, renters believed that they made a big contribution to the high value of the area. Compared to what they have put into, the compensation was too small to begin a new life. The serious problem is that the lost key money was naturally absorbed by the land owners. However, the reality is that there is no law guaranteeing the renters?key money,:said Kwon Jung-soon, a lawyer and member of MINBYUN-Lawyers for a Democratic Society.
On the other hand, tenants who lived in the designated removal districts have conflicts with the landlords. In the law of public project's compensation, tenants who are damaged by the NTP's removal will be provided with rented apartments, residential transfer fee, and property transfer fee to the landlord? union. Originally, the tenants can have only one right of those three. However, the law was changed in 2007 and caused different standard of compensation in each district.
The difference is shown even within the same NTP territories. In the Wangsimni New Town site, there are three divided districts, and each district's situation was different. In the case of the first and third districts of Wangsimni there was compensation to the tenants providing all three things. But the second district? landlords have a different opinion. Tenants in the second district of Wangsimni insist that landlords continuously applied the old law. "We have run the protest for 20 months, but nothing was solved. We talked with a leader of the Seongdong-gu office, but they have no resolution. It is strange that the office does not have any standards about the compensation,"Park Hye-sook, a protester in front of Seongdong-gu office, said.
Why Are These Problems Occurring?
Then, what is the reason for the occurrence of this phenomenon? Seoul enacted this project extending over exceedingly wide areas. Compared to the pre-existing redevelopment system, the biggest difference is that the planned districts of the NTP are wider than the past redevelopment sites of Seoul. According to Sharing and Future? data, the sites of the NTP are about 26 million square meter, and the completed redevelopment site, which had been done for 30 years, is about 15 million square meter. In other words, the district for the NTP is eight percent of the living territory of Seoul, and about eight hundred thousand people, which are about 10 percent of the citizens in Seoul, are influenced by this project. Lee Ju-won expressed this situation as that " Seoul's administration created big monster."Lee said, "The society cannot stop the arrogance of this monster, and it is causing various social side effects such as the compensation problem, key money chaos, the disappearance of low-cost housing, and tenants?removals in a lot of areas."
Another cause is that the power of capital investment is stronger than the government and tenants, so the government's mediation is weak. Before 1970, the government carried out urban redevelopment using their own funds. However, capital investment, such as construction companies and the union of landlords has intervened since 1973, and people call this redevelopment the Joint Development Method. Hence, the government? function has changed from constructor to a supervisory office. However, governments do not listen to their voices carefully, and just pursue their benefits. In the process of permission, the government does not check thoroughly that the landlords?unions prepare tenants' agreements and a suitable budget. The government also expects to benefit after the redevelopment from things such as more property tax, so it wishes the redevelopment to finish quickly,?said Kwon.
Responsibility of the Government
To root out these problems, experts emphasize that the role of the government is important. The criticism of NTP should be targeting the government, not the landlords, because the purpose of landlords and companies is making their maximized benefits. The government should intervene between the capital investors and tenants like the United Kingdom.
In case of the United Kingdom, they perform a method called Circulation Redevelopment Method. The government usually redevelops in a long time and makes progress in small steps so that citizens are not influenced by the redevelopment process. And they build a tenants?shelter in advance so that tenants can live safely until the redevelopment is completed. The UK government? effort brought out the result which prevents the skyrocketing of rental deposits. Lee Eun-jung, Captain of the New Town Tenants Union said, "In Korea, the compensation policy is ridiculously inadequate. Rental apartments are limited, and the fee is too expensive to tenants. Tenants worry that they newly adapt this one-sided and short-term NTP."
For solving the tenant-merchants's key money problem, experts suggest an ?viction fee.?It is the method that tenant-merchants receive the compensation considering fairness so that they can maintain their stores in different areas. In Japan, a system of dealing eviction fee is a custom. About 20 to 30 percent of landlords?benefit from redevelopment is used for eviction fee, and helping renters to work normally.
Apart from paying the eviction fees, there needs to be a governmental policy which makes landlords pays differential compensation to each merchant rather than providing the same amount to every store.
Tenants Want to Survive
After the Yongsan Tragedy, the government moved to improve tenants' rights and passed several provisions. But experts say that even with several of these systems built, it has not gotten better. Without the problems of compensation and money, tenants lose their houses and their lives. For guaranteeing their rights, the governments must recognize ways to protect tenants' from living a tough life, and help tenants. "After the removal in Wangsimni, the small community collapsed because residents scattered to various places. Kindergartens, schools, and many regular social gatherings disappeared. I want to go back my hometown which became a part of me,"said Lee Eun-jung.