Korean Air reached a tentative agreement with the city of Seoul to sell a plot of land in central Seoul, according to industry sources Thursday. The airline is expected to secure about 450 billion won to 550 billion won ($399 million to $488 million) in cash from the deal.

Industry officials said Seoul and the flag carrier are close to finalizing contract terms for the property sale located in Songhyeon-dong, in the central district of Jongno, as early as next week.

As part of its efforts to secure liquidity, Korean Air put up the 36,642-square-meter plot for sale last year, and has been negotiating with the Seoul Metropolitan Government, which plans to create a public park there.

Their previous negotiation fell through at the last minute last year, as the two sides were at odds on determining the date of sale.

This time, Korean Air has reportedly accepted the city government’s demand to not fix the date of sale.

Due to a budget shortage, the Seoul Metropolitan Government has sought a barter deal, with the state-run Korea Land & Housing Corp. acting as an intermediary. It had hoped to provide a plot in Mapo-gu, where the Seobu Driver’s License testing site is currently located, in exchange for the Songhyeon-dong plot.

The city’s plan, however, has faced backlash from Mapo-gu, as both the district council and residents claimed it is unfair for the city to unilaterally decide on the land inside its district. The city of Seoul has thus been hesitant to fix on the date of sale with Korean Air.

By Jo He-rim (herim@heraldcorp.com)