After years reeling from a lack of foreign investment and a moribund property market, Songdo is brimming with fresh vigor and a new vision as it was picked to house the secretariat of the Green Climate Fund.

Long known for its seaside amusement park, the reclaimed island is the centerpiece of the Incheon Free Economic Zone, launched in 2003 with an aim of developing a leading business, logistics and tourism center in Northeast Asia.

The ambition, however, was dented by doubts of its advantages against potential rivals Shanghai and Hong Kong; domestic controversy over financial, real-estate and labor deregulations; and a lack of interest from international investors.

Worse, the global financial meltdown in 2008-09 took a huge toll on the FEZ. Cross-border investment dried up, development projects stalled and the city government’s debt snowballed.

Now home to the U.N. entity, Songdo is gaining fresh momentum for revival. It seeks to transform into an international symbol of environmental conservation, shaking off financial straits and the image as a phantom city.

The district is famed for reusing around 40 percent of sewage and 76 percent of waste. Songdo Conventia, where the vote results were unveiled Saturday, became Asia’s first LEED certified convention center in 2010 for its environmentally sustainable architecture by the U.S. Green Building Council.

The GCF plans to draw in about $100 billion a year by 2020 to help developing countries adapt to climate change and curb carbon emissions.

The state-run Korea Development Institute estimates the annual economic impact at about 380 billion won, assuming that the agency maintains a workforce of 500. Finance Minister Bahk Jae-wan equated the feat with hosting a mega-sized multinational enterprises.

Realtors are also elated as dozens of long-unsold apartments have suddenly sold like quickly. Some analysts say the region’s real estate market had bottomed out and the GCF will trigger a full-fledged upturn.

By Shin Hyon-hee (heeshin@heraldcorp.com)