DAEJEON — A long-stalled mixed-use development at the Daejeon Station area has collapsed once again.
The Daejeon Metropolitan Government said on the 21st that Korail notified the Hanwha E&C consortium on the 20th of its plan to terminate the development agreement for the Daejeon Station area mixed-use District 2-1.
The project began in October 2020, when Korail and the Hanwha E&C consortium signed an agreement to pursue the development. It won approval for its implementation plan in March 2024.
The developer completed key administrative steps, including an integrated review to revise the implementation plan, in October 2025. But construction was repeatedly delayed by rising building costs and interest rates and a downturn in the property market.
The city had provided a series of administrative measures to improve the project's viability, raising the share of residential floor area to 72.6% from 62.3% and lifting the floor area ratio to 1,100% from 700%, while adjusting the scale of the facilities to be built. Korail also extended the deadline for the remaining land payment six times in an effort to keep the project alive.
Hanwha E&C, the lead developer, maintained that the project could not be made financially viable. The project company, Daejeon Station Area Development PFV, ultimately failed to pay the outstanding land balance by the Oct. 19 deadline.
The city now plans to pursue a range of options to revive the project, including restructuring the development plan and attracting a new private developer.
Working with Korail, the city said it will weigh future development conditions and demand before drawing up a recovery plan centered on improving viability through a restructured development plan, reviewing changes to the promotion plan to attract a new private developer, and running a joint task force with related agencies.
The city will reexamine the existing plan for a 72-story building and recalculate the appropriate scale of the residential, office, retail and lodging facilities to ease construction cost burdens and improve returns.
It will also continue talks with potential investors, including large construction firms, and analyze the terms of the earlier public tender and the project's economics to prepare improved conditions before issuing a new call for bids.
The city plans to form a joint task force with Korail, Dong-gu (East District) Office and outside experts, dividing roles among the agencies on matters such as revising the development plan and recruiting a new developer.
After consultations with Korail, the city aims to reopen bidding for a new private developer in the second half of 2027.
"It is deeply regrettable that the Daejeon Station area development has fallen through," said Choi Jong-soo, head of the city's urban affairs bureau. "We will closely reexamine the existing development plan and project structure and work in close cooperation with related agencies to find a workable way to get this project back on track."