Koramco seeks to sell Seoul prime office tower in $272 million deal

South Korea’s Koramco REITs Management & Trust Co. is poised 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 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 reviewing 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 about 400 billion won in view of the transaction prices of similar properties in the area at 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 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 comes despite souring investor sentiment on local office buildings due to the country's prolonged political crisis 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 its sale of a landmark building in Seoul last month as bids for the Seoul Financial Center fell short of initial estimates.

Pebblestone Asset Management Co., founded in 2016 by Terry Hwang, the former CEO of Deutsche Asset Management Korea Ltd., also withdrew the planned sale of an office building in Seoul’s central business district.

Write to Byeong-Hwa Ryu at hwahwa@hankyung.com
 
Jongwoo Cheon edited this aricle.