Skip to content
  • KOSPI 3177.52 +5.86 +0.18%
  • KOSDAQ 1025.71 +3.49 +0.34%
  • KOSPI200 427.37 +0.62 +0.15%
  • USD/KRW 1117.4 4.00 0.36%
  • JPY100/KRW 1,034.44 4.32 0.42%
  • EUR/KRW 1,344.96 5.32 0.40%
  • CNH/KRW 171.95 0.61 0.35%
View Market Snapshot

Ascendas buys $69 mn Seoul hotel from KTCU-backed fund

Nov 30, 2018 (Gmt+09:00)

Singapore’s Ascendas Hospitality Trust has acquired a hotel in downtown Seoul for 77.5 billion won ($69 million) from a South Korean real estate fund backed by Korean Teachers’ Credit Union (KTCU) and tobacco maker KT&G Corp,  according to Ascendas’ announcement on Nov. 29.


The acquisition price for ibis Ambassador Seoul Insadong is little changed from the 75 billion won paid by Seoul-based Richmond Asset Management’s trust fund in 2013 to buy the 363-room hotel, shortly after the construction completion.


KTCU had reportedly invested 30 billion won in the vehicle as the biggest limited partner, and KT&G, short for Korean Tobacco & Ginseng Corporation, injected 10 billion won. Richmond Asset financed the remaining cost with secured loans.


It was priced at a 3.1 per cent discount to its latest valuation for a net property income yield of 4.6 per cent, according to the Business Times.


The 12-story hotel is operated by Ambassador Hotel Group under a master lease agreement.


The transaction was the second hotel acquisition in Seoul by the Singapore-listed fund, after it bought four-star Splaisir Seoul Dongdaemun hotel for 72.1 billion won from a Korean developer in April of this year.


It signed a long-term agreement with Japan’s Sotetsu Hotels to lease the 215-room hotel for up to 20 years for a monthly rent of 262.5 million won, starting from July of this year.


Their locations close to tourist attractions and business districts underpinned the acquisition decisions, with rising inbound tourists.


Ascendas-Singbridge Group, parent of Ascendas Hospitality Trust, has been an aggressive foreign investor in South Korea’s real estate market since 2002.


It bought a mid-sized new office building in the up-scale Gangnam district of Seoul for S$124.3 million in November 2017, just after selling an office tower for $635 million to a South Korean asset manager backed by the National Pension Service in July of the year.


Ascendas-Singbridge Group is jointly owned by two Singapore’s state-owned companies – Temasek Holdings and JTC Corporation- and manages over $15 billion in assets.

Yeonhee Kim edited this article

Comment 0

0/300