South Korea’s Daelim Industrial Company is set to develop a 500-hectare residential town in Tehran, Iran, at an investment of around €900 million ($1.06 billion), said a report.

The investment will be a major boost to the new township of Kharazmi about 50 km southeast of the Iranian capital, reported the Press TV.

The city is being built as part of satellite towns which are being developed to ease congestion in the Iranian capital of about 12 million, said the report citing officials from Iran’s Ministry of Roads and Urban Development.

Iran was once the sixth largest market in terms of orders won by South Korean builders, according to a statement by the Ministry of Trade, Industry and Energy in Seoul.

Korea Eximbank has said it was ready to provide project financing, loans and credit to Korean firms trying to secure business in Iran.

It is also seeking to secure a memorandum of understanding with Tehran on building 10 hospitals in the country, said the report.