A view of the main building at Yangon International Airport. REUTERS/Stan Honda/Pool

Land prices have skyrocketed by as much as 100-fold in Myanmar’s city of Bago, following the announcement that Incheon International Airport Corp. of South Korea was awarded the contract to build and operate Hanthawaddy International Airport, which is expected to become Myanmar’s largest international airport with a possible price tag of $1.1 billion.

The consortium led by Incheon International Airport was proclaimed the preferred bidder to build the airport on Aug. 10. Officials from Incheon will arrive in Myanmar at the end of August to negotiate the official contract with Myanmar’s Department of Civil Aviation, a process that may take up to two or three months. Discussions will encompass areas such as traveler capacity and infrastructure connections, said Park Jae-Kyung, the Korean embassy counselor and deputy chief of mission, according to the Myanmar Times.

Bago lies northeast of Yangon, Myanmar’s commercial center. Hanthawaddy Airport will require up to an hour and a half of travel time from Yangon, according to U Phyo Wai Yar Zar, managing director of All Asia Exclusive Travel Company, but constructing a highway could reduce that time significantly.

Both Hanthawaddy and Yangon International Airport, currently Myanmar’s major international hub, could serve as international gateways, rather than one for domestic and the other for international flights, Zar added, according to the Myanmar Times.

Real estate prices are already climbing in Bago in anticipation of the development of the airport and its surrounding areas, reported the Irrawaddy, a Myanmar news outlet based in Thailand, on Friday.

“Within a week of the announcement of the airport project, the buying and selling of land here has become brisk,” a real estate agent in Bago’s Shin Saw Pu quarter said. “Despite the soaring prices, a lot of people are ready to buy land here.”

Prior to the announcement of Incheon’s win, an acre of farmland near Bago sold for about 500,000 kyat ($510). Now, the going price for one acre in the same area is between 20 million and 50 million kyat, 100 times its previous price, while plots closer to the airport’s projected site are selling for about 80 million kyat per acre.

“Before, only farmers from Nyaung Yin villages owned the farmland surrounding the airport project area,” said Myint Soe, owner of the Bago-based Zarchi Real Estate. “With news of the project, giants from the real estate industry are offering high prices to buy the land from farmers, and now they are selling the land back for lucrative prices.”

One particular 200 feet by 100 feet plot (0.46 acres) was sold for 470 million kyat recently, said Soe, and the prices of plots on the same street are above 1.8 billion kyats currently, due to the airport project.

The Hanthawaddy project is expected to cover 9,000 acres, and the government may be relocating residents in the area to make space. The new hub is projected to handle 12 million passengers annually when it is finished in 2018, according to South Korea’s Ministry of Transport, the Irrawaddy reported.

With rental prices in Yangon already higher than New York City, companies hoping to establish operations in the commercial center but have been unable to find suitable land could potentially move to Bago, but only if they move fast enough and beat Bago's own booming real estate prices.