A British daily, citing South Korean sources, says North Korea is spending 170 billion won on new offices and villas for heir apparent Kim Jong-un.

The Daily Telegraph says this luxury villa construction spree, documented in satellite photographs, began as Kim Jong-un was named to succeed his ailing father, Kim Jong-il, last year.

It says that "House 15" in Pyongyang's central district, where Kim Jong-un grew up, has been rebuilt from the ground up. The building earlier served as home to Kim Jong-un's mother, Ko Young-hee.

The daily says that Kim Jong-il’s home is next door and that the two houses are thought to be connected by an underground tunnel.

It said that South Korean intelligence sources believe that a new villa has also been built for the younger Kim in North Hamgyeong Province.

The article cited an assessment by the U.N. World Food Program in November that public food rations provided to 68 percent of the North Korean population met less than half their needs.