Woori Bank said Wednesday it will participate as the largest investor in the government-backed “Future City Fund,” aimed at supporting redevelopment projects in first-generation new towns.
The policy fund was created to provide stable financing for aging apartment complexes in areas such as Bundang and Ilsan, where reconstruction is being pursued. It is designed to supply essential early-stage project costs from the planning stage, helping projects move forward more smoothly.
Woori Bank will commit 480 billion won to the first master fund, which totals 600 billion won, as part of a broader 12 trillion won Future City Fund initiative. Linked to guarantees from the Korea Housing & Urban Guarantee Corp. (HUG), the funding will be provided at low interest rates, up to 20 billion won per project site, the bank said.
Woori Asset Management will run the fund. The selection will allow the firm to expand beyond traditional asset management into alternative investments and large policy funds, it said.
Major investors, including Woori Bank, have completed investment agreements to establish the fund. It will operate on a capital-call basis, with money drawn and deployed when needed. Actual disbursements will begin after the first borrower project is chosen among designated leading districts in the first-generation new towns and requests financial support.
Lee Jin-kyung, a team leader in Woori Bank’s structured finance department, said the bank’s participation will help ease early funding shortages for aging new-town redevelopment and provide a more stable foundation for projects. He said the bank will continue expanding structured finance tied to policy financing.
* This article has been translated by AI.
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