This article was published on July 4, 2025, at 4:21 p.m. on the ChosunBiz MoneyMove site.
KT's plan to sell real estate valued at 3 trillion won, which was intended to fund its artificial intelligence (AI) business by selling major hotels in Seoul, has been delayed for nearly eight months. Moreover, it appears that the list of properties for sale has shrunk, with quality assets being excluded.
According to investment banking (IB) industry sources on the 4th, the real estate sale, which was a key initiative of KT CEO Kim Young-seob, has still not received approval from the board of directors. The consortium of sales advisory firms, including Samjong KPMG, Avison Young, Colliers Korea, and RealtyPlanet, has delivered consulting results to KT, but internal decisions are still being delayed.
A source familiar with this real estate liquidity plan noted, "The consortium's consulting service has been completed, and based on the consulting results, they are in the process of deciding which properties to sell and which ones not to sell internally."
Last November, KT indicated that it would liquidate real estate to improve its return on equity (ROE) by participating in a value-up program. Subsequently, in December, it selected the Samjong KPMG consortium as the lead underwriter. At that time, KT intended to prepare a specific liquidity plan by the end of January this year, but differences in opinions about the assets to be liquidated and rapidly changing external circumstances have delayed the sale efforts until now.
Moreover, it has been reported that quality hotels have been removed from the current details, leading to a somewhat disappointing atmosphere in the industry. The properties submitted by the consortium for real estate asset optimization are known to include the 'Novotel Ambassador Dongdaemun Hotel & Residence' and 'Sofitel Ambassador Seoul'.
Initially, KT considered selling these hotels, along with the Andaz Hotel in Gangnam, Le Meridien & Moxy Myeongdong in Jung-gu, and Shilla Stay Yeoksam. The value of these hotels was approximately 2 trillion won, generating significant market interest, but they have effectively halved in scale. In particular, the Andaz Hotel, which opened in 2019, is evaluated as a prime asset due to its location and profitability, as it is a 5-star hotel in the Hyatt chain.
Some in the industry suggest that hotels removed from the sale list may be considered for conversion into residential or office spaces. For instance, Homes Company acquired the former Deas Myeongdong Hotel in October last year with UK asset management firm ICG and decided to remodel it into a co-living space. This strategy aims to secure both stability as a residential facility and profitability as a lodging facility.
CEO Kim emphasized once again in March that despite pushback from some current and former employees and shareholders, he would pursue asset liquidity through real estate sales. At the world's largest mobile communications exhibition, the Mobile World Congress (MWC), he said, "Since the core business of the telecommunications company is not the hospitality industry, we will effectively utilize limited resources to grow our primary business."
During that month's regular shareholder meeting, he responded to a shareholder's question regarding whether the sale of real estate was aimed at temporarily boosting stock prices by stating, "(Even though the real estate business, including hotels, is achieving certain results) this is ultimately only a collateral asset for future growth." He explained that it is preferable to sell idle real estate for its fair value to utilize it as a source for growth. In response, the KT New Union and some former executives have expressed concerns that KT's hotel sales could negatively impact future competitiveness.
Concerns have also arisen that KT's real estate sales may be delayed for an extended period. An industry source said, "Though CEO Kim's term runs until March of next year, there are analyses suggesting that early resignation pressure from a regime change and ongoing pushback regarding real estate sales may become burdensome," and added, "If a decision is not made soon at the board level, it appears that asset sales will be out of reach by the end of this year."
A KT official stated, "The sale target and its status have not been finalized yet, and a final decision is expected after comprehensive review," and added, "We plan to proceed with the process in accordance with the management environment and market conditions, and it is difficult to confirm the individual sale status or procedures for each review target."