NH Nonghyup buys Donuimun D Tower for $640 mn

NH Nonghyup REITs Management Co. has completed the purchase of Donuimun D Tower, a prime office building in central Seoul, for 895.3 billion won ($640 million), notching the second-largest commercial property transaction in South Korea this year.

The unit of Nonghyup Financial Group acquired the property from another Korean asset manager, Mastern Investment Management Co., DL Holdings Co. said on Friday.

DL Holdings is an anchor investor in a Mastern Investment fund raised for the 660-billion-won purchase of Donuimun D Tower in 2020. It is also the holding company of Korea’s construction and petrochemical-focused conglomerate DL Group.

The property deal yielded an annualized return of over 20%, including rents, with a capital gain of about 240 billion won ($170 million).

DL Holdings pocketed about 130 billion won in cash from the transaction, nearly matching its third-quarter operating profit of 121.4 billion won this year on a consolidated basis.

The 86,224 square meter building is located in a central business district near Seodaemun Station. It contains 26 above-ground floors and seven below ground. DL Group rents it as its headquarters.

Earlier this year, Samsung Group acquired The Asset, a landmark office tower in Seoul, for 1.1 trillion won. It is used as Samsung Fire & Marine Insurance Co.'s headquarters.

DL Group has been selling non-core assets to shore up its bottom line. It recently put three hotels on the market in a package deal to raise around 650 billion won.

Write to So-Hyeon Kim at alpha@hankyung.com
Yeonhee Kim edited this article.