In general, despite ongoing urban obsolescence and decay, urban restoration through development became a strenuous challenge due to the economic recession. As for Korea, development-oriented urban renewal has been faced with limitations, and, as a result, its renewal policy has been shifting towards a direction of focusing on regional characteristics and values. Now is the time to establish appropriate strategies and plans incorporating the unique aspects of Korea, with a shrinkage-accommodating plan towards ill-matched scale and demand as well as low use of space.

Accordingly, a concept of shrinking smart for urban renewal and its planning direction are newly established in this research based on a relationship with its relevant concepts, such as smart growth, compact city and new urbanism that are found in a paradigm of urban planning. In this research, shrinking smart for urban renewal is defined as an extended philosophy of existing concepts like smart decline and smart shrinkage, and it is more focused on improving the quality of urban people’s lives with less development of population, buildings and land use.