Exclusive Jeonju Korea Textile Site Development Crisis... "Pay Back Your Debt" Blitz

[Anchor]
It is one of the biggest interests in Jeonju, Jeollabuk-do.

The trillion-unit development project being promoted on the site of the old textile factory in the middle of the city has faced a crippling crisis.

The project has been maintained with project financing and PF loans, and it has been confirmed that the lenders who lent hundreds of billions of dollars have now asked the developer to pay back the money.

Reporter Kim Min-sung's exclusive report.

[Reporter]
It is the site of the former Jeonju factory of Daehan Textile, a large-scale gold straw land with a size of 230,000 square meters and 30 soccer fields.

In 2017, developer Jagwang bought land from Daehan Textile for about 200 billion won and announced plans to develop skyscrapers, apartments, and complex shopping malls early.

It is a large-scale project with an estimated development cost of 6.2 trillion won, which is one-hundredth of the Korean government's one-year budget this year.

[Eun-soo Jeon / CEO of Real Estate Development Co., Ltd. (December 2022) : We plan to build a tourist attraction tower to attract tens of millions of tourists to Jeonju in the future. The foundation of industry and economy that should be handed over to future generations....]

As of the end of last year, Jagwang owed about 370 billion won as of the end of last year.

However, the YTN report confirmed that the loan company, including Korea Investment & Securities and Mirae Asset Securities, has recently caused an event of default (EOD) that requires the loan company to repay the full amount of the loan.

With the lender giving the end of up to two months as of Monday last week, Jagwang reportedly submitted a plan to normalize the business to the lender's council.

It is the second time that the business is already in a limbo due to the occurrence of EOD.

During the first crisis last year, the crisis was overcome with the willingness of Lotte Engineering & Construction, which gave credit to participate in the project, but the situation has changed this year.

This time, Lotte Engineering & Construction paid off all debts to IBK Investment & Securities, which lent about 100 billion won to Jagwang as originally guaranteed.

In response, a Lotte Engineering & Construction official said, "We hope that the business will normalize as soon as possible due to good consultations between the lender and the developer." Some say that Lotte Engineering & Construction is trying to pull out of the business in light of industry precedents.

[Lee Moon-ok / Secretary-General of Jeonju Citizens' Association: Lotte Engineering & Construction has set up a preferred beneficiary right of about 200 billion won for the Sejong City golf course owned by Jagwang. I think the amount Lotte Engineering & Construction asked can be enough to get out with that 200 billion won.

I contacted Jagwang several times to hear about concerns about business disruptions and the direction of future responses, but I couldn't reach it.

I'm Kim Minsung of YTN.