South Korea’s Koramco REITs Management & Trust Co. is set to sell a prime office building in Seoul in an estimated 400 billion won ($272 million) deal, investment banking industry sources said on Monday.
Koramco is in talks with real estate sale advisors to unload the Centre Point Gwanghwamun, a 22-story office building in the South Korean capital’s central business district, the sources said.
The real estate investment company plans to send requests for proposals after checking market conditions and demand with the advisors, according to the sources.
The building with a total floor area of 39,946 square meters was valued at around 400 billion won, considering the transaction price of similar properties in the area of 33 million won to 35 million won per 3.3 square meters, real estate industry sources said.
Koramco bought the building for 320.7 billion won in 2016 through its REIT, in which South Korea’s Public Officials Benefit Association (POBA) and KT&G Corp. have stakes, from Seoul-based Mastern Investment Management.
Mastern acquired the building in 2012 for 214 billion won from its builder, Ssangyong Engineering & Construction Co.
WEAK SENTIMENT DUE TO SUSTAINED POLITICAL WOES
Koramco’s sale came although investor sentiment on local office buildings soured due to the prolonged political crisis in South Korea with President Yoon Suk Yeol impeached over his surprise martial law decree in December.
Singapore’s GIC Private Ltd., the world’s sixth-largest sovereign wealth fund, dropped the sale of a landmark building in Seoul last month as bids for Seoul Financial Center fell short of the initial estimates.
Pebblestone Asset Management Co., founded in 2016 by Terry Hwang, former CEO of Deutsche Asset Management Korea Ltd., also withdrew the planned sale of an office building in Seoul’s central business district.
By Byeong-Hwa Ryu
hwahwa@hankyung.com
Jongwoo Cheon edited this aricle.
