The Impact of Seoul City Public Apartment Complex Characteristics on Management Fees

Purpose This study aimed to establish a foundation for developing a reasonable fee calculation system that accounts for the unique characteristics of each apartment complex by empirically examing the impact of various features of Seoul's sale and public rental apartment complexes on the commissioned management fee. Research design, data and methodology: This study targeted 1,547 private apartment complexes and 550 public rental apartment complexes using K-apt and SH Corporation data, with key variables including the number of units, building age, heating system type, and corridor type. Results: The findings indicate that, in the case of condominium apartments, the number of units and the building age are significantly negatively associated with commission fees. As the number of units and the building age increase, the commissioned management fee tends to decrease, indicating the combined effects of ‘economies of scale’ and reduced management efficiency due to after equipment aging. In terms of corridor type, the corridor -style layouts were associated with significantly higher fees than staircase-style. In contrast, in the case of public rental apartments, the number of units did not show a significant effect on the commisioned management fee, while only building age showed a statistically significant negative relationship. Additionally, variables such as heating system type, rental type, and corridor type were not found to be significant, suggesting that the physical and opertational characteristics of the complex have a limited influence on the calculations in the context of public rental housing.