[WHY] How did Gangnam become the Seoul epicenter it is today?

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[WHY] How did Gangnam become the Seoul epicenter it is today?

Views of apartments from Mount Daemo in Gangnam District, southern Seoul, in November. [NEWS1]

Views of apartments from Mount Daemo in Gangnam District, southern Seoul, in November. [NEWS1]

 
Gangnam is known globally as the posh neighborhood that served as the backdrop of the “Gangnam Style” sensation in 2012.  

 
Gangnam, where the biggest trends begin in Korea, is the mecca for almost everything loved by locals and tourists, from streets filled with luxury brands to the trendiest restaurants and even plastic surgery.
  
The term Gangnam technically means south of the river, and refers to three districts in Seoul below the Han River: Gangnam, Seocho and Songpa.
 
Residents in the entire Gangnam region are often characterized as having either come from a wealthy family or hard workers with professional jobs. So living in Gangnam is often seen as a barometer for one’s financial success.  
 
Of all the households in Seoul with a monthly income above 8 million won ($6,400), 33.2 percent were in Gangnam District and 27.9 percent in Seocho District, according to a report published by Seoul City last June. Songpa District came in at fifth with 23.8 percent, after Yongsan District in central Seoul and Seongdong District in eastern Seoul.  
 
Many popular sports stars, celebrities and lawmakers are or were once residents of the area, including actors Ko So-young, Ha Seok-jin and even President Yoon Suk Yeol, before he entered the presidential office in Yongsan District.
 
Of the 59 senior government officials under the Yoon administration, 49 percent of them own a house in Gangnam, according to data by Democratic Party lawmaker Koh Yong-jin in September.
 
But Gangnam hasn’t always been this fancy. Only in the last few decades has the area started to build up the reputation it has today.
 
Students on the streets filled with private academies in Daechi-dong in Gangnam District, southern Seoul, in 2021.[YONHAP]

Students on the streets filled with private academies in Daechi-dong in Gangnam District, southern Seoul, in 2021.[YONHAP]

 

Why do people want to live in Gangnam? What's so great about living there?

 
Gangnam has all the characteristics a neighborhood needs to pull people in, like good jobs, transportation, education and surroundings.
 
Of more than 1 million companies located in Seoul, around 10 percent are in Gangnam, according to the Korean Statistical Information Service.
 
Some of the major firms with headquarters in the three districts include Hyundai Motor, GS Caltex, NCSoft and crypto exchange Upbit operator Dunamu.
 
Gangnam is also a popular location among start-ups as they aim to build networks and find potential investors in the area.
 
“A lot of start-ups open offices in Gangnam, especially on Teheran street, because they can easily network and meet potential investors,” said Kaia Cha, a manager at Startup Alliance. “A lot of organizations that offer support programs for start-ups are also located in Gangnam.”

 
Even for those who don't work, Gangnam is an attractive place to live, especially those raising children.
 
It boasts some of the most prestigious schools in the country and is home to the famous education hot spot, Daechi-dong.
 
Daechi-dong is considered a hub of private education with more than 900 hagwon (private cram schools) crammed within a couple of blocks. That is four times more than in Nowon District, northern Seoul, which houses the city's second largest hagwon street.
 
To attend popular hagwon, students have to wait for months just to take a placement test. Some parents wait in line for hours at dawn, just to sign up for a class held by popular hagwon teachers.
 
During summer and winter vacations, students nationwide swarm into the neighborhood to attend the hagwons, creating a steady demand for apartment units nearby.  
 
“I went to a Daechi-dong hagwon when I was a high school student because teachers there had more information on the suneung,” or the university entrance exam, said Hur Da-hee, an office worker.
 
Of all the students that were accepted into Seoul National University (SNU) last year, the top ranking university in Korea, 11.9 percent graduated from high schools in Gangnam and Seocho districts, according to data Democratic Party lawmaker Kang Min-jung received from SNU.
 
This education fever is reflected in housing prices.
 
The price of a 34-pyeong (1,210-square-foot) unit at Eunma Town apartment in Daechi-dong jumped 170 percent over the past decade through January, while the price for its jeonse (lump-sum deposit) jumped 68 percent, according to HogangNoNo, an apartment information provider.
 
The 44-year-old housing units sold for 2.82 billion won ($2.24 million) at their peak in November 2021.
 
During the same period, the nationwide average apartment sales price per square meter grew 96 percent while average jeonse price increased 86 percent, according to KB Land.
 
Galleria Department Store Luxury Hall West in Apgujeong-dong in Gangnam District, southern Seoul [GANGNAM-GU OFFICE]

Galleria Department Store Luxury Hall West in Apgujeong-dong in Gangnam District, southern Seoul [GANGNAM-GU OFFICE]

 

What else is Gangnam famous for?

 
Apart from education, Gangnam is also well-known for luxury shopping.
 
Cheongdam-dong in Gangnam District boasts luxury shopping streets, filled with global luxury brand stores, including Chanel, Louis Vuitton, Gucci and Dior.
 
Department stores in Gangnam also carry more luxury brands.
 
The quality of a department store is usually judged by whether they carry the three top brands: Hermes, Louis Vuitton and Chanel.
 
Of the seven department stores nationwide that carry all three brands, four are located in Gangnam.
 
Naturally, department stores in Gangnam boast the highest revenue.
 
Last year, Shinsegae Department Store’s Gangnam branch in Seocho District reported 2.84 trillion won in revenue, followed by Lotte Department Store’s Jamsil branch in Songpa District, which recorded 2.60 trillion won. Hyundai Department Store’s Apgujeong branch came in at seventh with 1.24 trillion won.
 
The reputation of the department stores pull in customers from outside Gangnam.
 
“My fiancé and I went to the Galleria Department Store in Apgujeong to buy gifts for each other ahead of our wedding because I heard there are more diverse types of luxury products there,” said 31-year-old Kim Eun-ji who lives in Mok-dong, western Seoul. ”I was looking for products from Dior, but there aren’t many brands at the department store in Mok-dong.”
 
Easy access is another factor pulling more shoppers into Gangnam.
 
“Our Gangnam branch has great accessibility, connected to three subway lines and an express bus terminal” that travels from suburban areas, said Yoon Ji-sang, a spokesperson for Shinsegae Department Store. “More than 50 percent of our customers come from outside Seocho District,” where its branch is located.
 
Sign boards of plastic surgery clinics in Gangnam in 2018 [SHUTTERSTOCK]

Sign boards of plastic surgery clinics in Gangnam in 2018 [SHUTTERSTOCK]

 
Gangnam is also known for its huge number of plastic surgery clinics, particularly in Sinsa-dong.
 
Sinsa subway station is filled with advertisements for plastic surgery, and buses are pasted with ads promoting the clinics.
 
It's not uncommon to find people whose faces are wrapped in bandages due to plastic surgery strutting the streets.
 
There were 470 plastic surgery clinics registered in Gangnam in 2017, according to the National Tax Service. That is more than 30 percent of the total number of clinics in the country.
 
The National Tax Service hasn’t updated the figure since.
 
“I didn’t think twice about where to get my eyes done,” said a 31-year-old who underwent surgery late last year. Gangnam was their first choice because “there are lots of plastic surgery clinics there, and all the clinics my friends recommended were in Gangnam.”
 
 

Was Gangnam always this popular?

 
Gangnam's current reputation doesn't actually date too far back. The region's development began in the 1960s during the presidency of Park Chung Hee.
 
Before the development, Gangnam was farmland and lots of mulberry fields.
 
Gangnam had long been excluded from development plans because of the lowlands and swamps that made construction there challenging. Its geographical features still make the area vulnerable to flooding, as was seen after heavy rainfall hit the area last summer.
 
Back in the 1960s, Gangbuk, or the areas north of the Han River, was more popular to live in than Gangnam. Most department stores and prestigious schools were located in Gangbuk, largely populated by the affluent.
 
Gangnam at the time was just “a secluded and peaceful village with several shabby thatched houses that stood on the foot of the hills,” according to late Son Jeong-mok, former director of the Urban Planning Bureau of the Seoul Metropolitan Government, in an interview with the JoongAng Ilbo in 2014.
 
Even two decades after development kicked off, Gangnam was still like the countryside.
 
“Everything in Gangnam was farmland when we moved there,” said a resident of Gangnam District who moved to the city in 1982 from Gangbuk. “I saw cows plowing fields and could smell fertilizer. The environment was a little scary as all the surroundings were paddies and mountains.”
 
 

Why was Gangnam developed?

 
The primary purpose was to disperse Seoul’s population, which was densely concentrated in Gangbuk. In the 1960s, more than 70 percent of Seoul’s population lived in Gangbuk. In 1970, Seoul's population reached 5.43 million, up 14 percent from a year earlier.
 
The overpopulation issue caused housing shortage problems and resulted in disorganized urban sprawl in the city.
 
“Gangbuk could no longer handle it. The population kept growing,” said Son. “The development of Gangnam first began in earnest in the 1970s, and the population was about 6 million at the time. Gangbuk couldn’t handle it. That’s how the development of Gangnam began.”

 
Concern over an invasion by North Korea was another motivation for Gangnam's development.
 
Back in the 1960s, Korea was concerned about a possible reinvasion by North Korea. Gangbuk was more vulnerable, being only around 40 kilometers (25 miles) away from the demarcation line between South and North Korea that was created in 1953.
 
The Blue House raid, launched by North Korean commandos to assassinate President Park Chung Hee in 1968, awoke the authorities to the need to disperse the population and public agencies further away from the demarcation line.  
 
In 1975, Seoul announced plans to build the social infrastructure to develop urban functions in Gangnam. Its first target was the transfer of government offices, like City Hall, the Public Prosecutors' Office and the headquarters of financial institutions, including the Bank of Korea and Korea Development Bank.
 
The attempt failed, and only the Supreme Court and the Public Prosecutors' Office moved to Gangnam. But over the course of the years, other institutions, like the National Intelligence Service, eventually moved to Gangnam.
 
 

Did the development have any side effects?

 
One major drawback of the development has been the creation of a sense of incompatibility, felt by residents both in and out of Gangnam.
 
“How does it feel to live in Gangnam?” one commenter asked on Blind, an anonymous community for workers, on Feb. 8. “I come from a poor family in Daejeon. I often go to Gangnam for work, but every time I go, I feel jealous and inferior and wonder what it would feel like to live in an apartment that costs at least 2 billion won.”
 
Gangnam residents also tend to feel a certain way.
 
“I was raised and have lived in Gangnam my whole life and also have a house under my name in Gangnam,” wrote another commenter on Blind last month.
 
“But I’m afraid to live here. In order to give the same level of pocket money and education my parents gave me to my children, I need a good income. But that won’t be possible as an ordinary office worker, and my children will be mocked as beggars.”
 
The average cost for taking classes at a hagwon in Daechi-dong is 28,000 won per hour, the highest in Seoul, according to HogangNoNo — more than twice the cost of those in Mapo District, western Seoul.
 
“Every country has a wealthy neighborhood,” said Kim Jun-hyung, a professor teaching real estate at Myongji University. “But the problem in Korea is that the government does not disclose the income of residents living in a district. Transparently disclosing the information and collecting larger amounts of tax from wealthy neighborhoods and spending it on neighborhoods with mid-to-low income will be good welfare that could provide more opportunities for people with mid-to-low income to enter Gangnam.”

 
Eunma Town Apartment in Daechi-dong in Gangnam District, southern Seoul, in October. [Yonhap]

Eunma Town Apartment in Daechi-dong in Gangnam District, southern Seoul, in October. [Yonhap]

 

Is Gangnam still being developed?

 
Gangnam development is still ongoing, with a massive underground public transit terminal and express trains to be established at Samseong Station in Gangnam District.
 
Projected to be Korea’s largest underground complex, the terminal spans 160,000 square meters (1.7 million square feet) and will comprise of seven basement floors that will serve as a multifunctional cultural and retail space.
 
The goal is to complete construction by 2028. More than a trillion won will be invested into the project.
 
The terminal will serve as a junction of transport, including for the Great Train Express (GTX) that will connect the southern and northern part of the metropolitan areas.
 
“Improved accessibility into Gangnam will increase hinterland of the city, which will result in construction of more facilities and commercial districts, consequently further raising the popularity of Gangnam,” said Prof. Kim.

 
The terminal and the GTX are expected to generate synergy effects with Hyundai Global Business Center, a massive development by Hyundai Motor Group to create an auto industry hub on land that spans across 79,342 square meters.
 
The construction is also spreading to apartments, as old apartments have received the green light to be reconstructed.
 
Eunma Town and Mido Mansion Apartment in Daechi-dong are some of the units to be reconstructed that are expected to turn into landmark units.
 
Eunma, constructed in 1979, received approval to be turned into a 35-story building, while Mido, built in 1983, is planned to be transformed into a 50-story building.
 
Eunma has been a symbol of Seoul's apartment reconstruction market, as its reconstruction has been subject to regulations and delays due to the authorities' concern of its repercussions on real estate speculation.
 
With all the developments planned, Gangnam's reputation, too, is only expected to build.
 
It has become more challenging for the government to yield influence on the further development of an area, as was done in the past when the epicenter of Seoul was shifted from Gangbuk to Gangnam.
 
“In the past, prestigious schools, public organizations and public workers were forced to move into Gangnam by the government. But using authoritative power to push such development isn’t easy today,” Kim added.
 
“With the infrastructure and transportation systems already concentrated in Gangnam and economies of scale already achieved, its reputation will stay solid unless South Korea and North Korea are unified,” said Prof. Seo Won-seok, who teaches at the department of urban planning and real estate at Chung-Ang University.

BY JIN MIN-JI [jin.minji@joongang.co.kr]
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