This article was published on the MoneyMove site of ChosunBiz on July 17, 2025, at 10:35 a.m.
Real estate alternative investment asset management companies, which thrived during the COVID-19 pandemic, are emerging as listings due to declining profitability amid worsening market conditions.
According to the investment banking (IB) industry on the 17th, the Military Mutual Aid Association is pushing to sell Mplus Asset Management, a real estate asset management company. This is the third attempt this year. The sale is guided by Samil, and the association is said to be receiving letters of intent (LOI) until the end of this week. Established in 2008, Mplus Asset Management was operated by the Korea Land Trust, a subsidiary of the Military Mutual Aid Association, before being fully integrated as a subsidiary in 2015.
The Military Mutual Aid Association selected the newly established private equity fund (PEF) management firm Cobalt Investment and VCM consortium as the preferred bidder in the first tender held in April. At that time, the Cobalt consortium proposed to acquire a 70% stake in Mplus Asset Management for 42 billion won, but it eventually fell through due to failure to secure funding.
The Military Mutual Aid Association hoped for a valuation of over 40 billion won in the second tender conducted in May, but the buyers suggested levels around 30 billion won, resulting in the sale collapsing.
Mugunghwa Trust is also proceeding with the resale of KREITs Investment Management, which had previously fallen through. The sale target is the total equity (98.23%) held through the 'Mugunghwa Growth No. 1' fund, with Samjong KPMG as the lead underwriter. Mugunghwa Trust received LOIs until May 30 and plans to conduct a tender on the 18th to select a preferred bidder within this month.
Mugunghwa Trust has been pushing for the sale of KREITs Investment Management since the end of last year. Two buyers participated in the tender, intending to select a preferred bidder in February, but all withdrew their bids after KREITs Investment Management received a suspension of operations from the Financial Supervisory Service. After the suspension was lifted, Mugunghwa Trust attempted to sell the firm again, aiming to close the transaction by September.
IGIS Asset Management, one of the top three real estate asset management firms in the country, is also up for sale. The firm distributed investment briefs (teaser letters) through its underwriter Morgan Stanley earlier this month, with around 20 domestic financial holding companies and asset management firms reportedly receiving them. The sale target includes about 70% ownership, featuring the founder's widow, Ms. Son Hwa-ja (with an ownership stake of 12.4%).
Mastern Asset Management is also considering the possibility of selling some of the equity held by its largest shareholder, former CEO Kim Dae-hyung. It was initially reported that Mastern Asset Management contacted potential buyers last year for pre-demand surveys but halted the process ahead of expected sanctions from the FSS. However, after receiving a warning that was lighter than the feared level of operational suspension at the recent FSS sanction deliberation committee, discussions about pursuing the sale of management rights have resurfaced.
The backdrop of various real estate asset management firms being listed is the difficult real estate market. In Korea, real estate development and project financing activities have practically come to a halt, and overseas real estate funds are incurring sequential losses. While asset management firms have generally generated profits through fund management fees and equity investments, these approaches are no longer effective, leading to restructuring.
An industry insider said, 'Large asset management firms may be different, but for mid-sized firms, it is virtually challenging to find buyers, resulting in delays in sales,' adding, 'Even around the second half of 2022, when the real estate market began to worsen, there were quite a few strategic investors (SI) wishing to enter the asset management industry, but as the market downturn prolonged, the recent situation has changed.'