As major construction firms have effectively swept up Seoul's urban redevelopment projects and regional housing markets have frozen over, mid-sized Korean builders are rapidly restructuring their business portfolios, moving away from their traditional reliance on housing and public works. They are rewriting survival strategies by seeking new revenue sources, including overseas direct development, energy infrastructure, senior housing, and small-scale redevelopment projects.
According to data from the Construction & Economy Research Institute of Korea released Tuesday, order volumes for mid-sized and small builders—estimated based on the gap between construction order statistics from the Korea National Data Agency and the Construction Association of Korea—shrank by more than half, from 34.2 trillion won in 2021 to 15.7 trillion won last year. Concentration among major firms in the urban redevelopment sector is also intensifying. Last year, the combined order value of the top five firms in urban redevelopment—Hyundai Engineering & Construction, Samsung C&T, GS Engineering & Construction, POSCO E&C, and HDC Hyundai Development Company—reached 36.859 trillion won, 3.1 times the 11.807 trillion won combined total of the sixth- through tenth-ranked firms.
With the Korea Land & Housing Corporation (LH) directly undertaking public land development projects, the room for mid-sized builders to squeeze into the domestic housing and public works markets has narrowed further. Amid a sense of crisis that sticking to traditional methods makes survival difficult, a shift in business focus toward overseas markets, energy, and senior housing is gaining momentum.
Bando Engineering & Construction is a leading example of a builder that has opened a path overseas. The company is focused on developing U.S. housing development into a recurring revenue model rather than a one-off business. After completing "The Bora 3170," a 252-unit complex in Los Angeles' Koreatown, it is accelerating construction on a follow-up 262-unit complex, "The Bora 3020," targeted for completion in January next year.
BS Hanyang's strategic base is Solaseado in Haenam, South Jeolla Province. The company is increasing the share of its energy business around this location. Representative projects include the Gwangyang biomass power plant scheduled for completion this year and the Yeosu Myodo LNG hub terminal targeted for operation in 2028. Backed by these projects, the share of revenue from the energy and infrastructure segment rose from 24% in 2024 to 30% in 2025.
Woomi Construction has identified senior housing as a core future business. Last year, it was selected as the preferred bidder for LH's Silver Stay pilot project at the Guri Galmae Station area, expanding its scope beyond simple construction to development and operation. Of the 725 units across five buildings rising 29 floors above ground, 346 units will be supplied as 20-year long-term rentals for middle-class senior citizens. Construction is scheduled to begin in January next year, with move-ins targeted for late 2029.
In the redevelopment sector, there is a clear trend of mid-sized builders carving into the niche of small-scale street housing redevelopment projects. Doosan Engineering & Construction secured construction rights in the first quarter of this year alone for the Shinan Villa reconstruction in Magok-dong, a street housing project in Sillim-dong, public redevelopment in Chungjeongno District 1 and Hongeun District 1, and the Myeongjang District 3 reconstruction in Busan. Ssangyong Engineering & Construction also won a street housing redevelopment project around Eunha Mansion near Noryangjin Station in February, securing six redevelopment projects worth approximately 600 billion won in Seoul alone.
"Last year, total construction orders increased in volume, but polarization by company size is spreading," said Lee Ji-hye, a research fellow at the Construction & Economy Research Institute of Korea. "It is time for policy support and strategies to resolve this polarization in order to secure the stability of the industry ecosystem and maintain regional construction markets."
