What to do with office buildings is biggest concern: POBA CIO

South Korea's Public Officials Benefit Association CIO Jang Dong-hun said on Wednesday that in the pandemic situation, POBA's real estate investment has been focused on residential and logistics sectors, while turning cautious about hotels and retail sectors.

"In this trend, global institutional investors now have very similar portfolios. In particular, the biggest concern for both domestic and overseas institutional investors will be about what to do with their office buildings," he said during a CIO panel session of ASK 2021 Conference.

For POBA, office buildings account for the biggest share of 32% of its real estate portfolio. Residential and logistics come next with 28% and 21%, respectively.

Over the past four to five years, POBA has gradually increased exposure to real estate debts. It manages 17.9 trillion won ($15 billion) in assets.

"Overall valuations are at burdensome levels, so it's difficult to find undervalued assets. We will invest in the sectors that weathered the COVID-19 situation like infrastructure and real estate. We will further increase exposure to real estate debts next year, as well as to private debt and slightly to growth capital for portfolio diversification," Jang added.

Write to Jong-woo Kim at jongwoo@hankyung.com
Yeonhee Kim edited this article