IGIS Asset Management said that, regarding the sale process for Yeoksam Centerfield, a core office asset in southern Seoul's Gangnam, it was not a unilateral decision that ignored the interests of beneficiaries, but an unavoidable step to prevent an event of default (EOD) amid uncertainty over extending the maturity.
IGIS Asset Management said in a statement on the 22nd that the Centerfield fund had faced prolonged uncertainty due to differing views among beneficiaries over extending the maturity, and that it began the sale process to ensure normal repayment and protect investors as the loan maturity approached.
According to IGIS Asset Management, the fund's original maturity is Oct. 2025, and from 2024, before the maturity date, the manager proposed a "mid- to long-term extension business plan" to beneficiaries and discussed extending the maturity. Shinsegae Property supported a maturity extension premised on retaining the asset, but the National Pension Service, a key beneficiary, took a negative stance on the extension, preventing agreement among beneficiaries. Ultimately, a one-year short-term extension was made in Oct. last year, but the firm said differences remain over whether to extend further.
IGIS Asset Management explained that it initiated the sale of Yeoksam Centerfield to avoid the risk of the asset going to auction or public sale. The company said, "Extending the loan maturity or refinancing requires a fund maturity extension as a precondition, but no agreement has been reached among beneficiaries so far," adding, "If we do not proceed with a sale under these conditions, an EOD could occur, and the asset could go to auction or public sale, leading to asset value impairment and investment losses."
It added, "Given that failure to repay the loan through a sale could expose both the fund and the asset to serious risk, deciding to sell at this point is, in fact, a measure to protect beneficiaries."
IGIS Asset Management said, "As the manager that led the entire process from deal sourcing to value-up efforts and asset stabilization for Centerfield, we feel a sense of responsibility," adding, "We sought to fulfill our duty as an asset manager by maximizing the fund's returns through a successful sale before maturity and repaying investors."
Earlier, the National Pension Service opposed IGIS Asset Management's decision to pursue a sale of Centerfield and decided to replace the general partner (GP). It is reportedly coordinating a schedule to convene a shareholders meeting with Shinsegae Property, a key beneficiary.
On this, IGIS Asset Management said, "Our top priority now is stable repayment of the fund and protection of beneficiary value," adding, "We will continue close communication with beneficiaries during the sale process to seek the best solution."