This article was displayed on the ChosunBiz MoneyMove (MM) site at 4:48 p.m. on Feb. 6, 2026.
Seoul Housing and Urban Development Corporation (SH) is reviewing the possibility of exercising a call option on private investors' equity in Seoul Investment Management. The plan is to acquire the equity held by banks, non-life insurers, and securities firms and convert Seoul Investment Management into a 100% subsidiary. The move is seen as laying the groundwork to reorganize the existing business structure centered on public rental housing REITs while preparing a new revenue model linked to policy goals.
According to the investment banking (IB) industry on the 6th, SH is considering acquiring the Seoul Investment Management equity held by Woori Bank (15%), Hanwha General Insurance (15%), Hana Non-Life Insurance (15%), Shinhan Bank (9.95%), and Shinhan Investment & Securities (9.95%). SH currently holds 35.1% of the common shares of Seoul Investment Management, while private investors hold a total of 64.9% in preferred shares.
Seoul Investment Management's core business is public rental housing REITs. It secures and supplies rental housing assets through various methods, including development-type, acquisition-type, and urban renewal–linked models. Of its total assets under management (AUM) of 3.5 trillion won, rental housing REITs account for about 2 trillion won. The REITs established by Seoul Investment Management to supply rental housing in Seoul number four, and including social housing REITs and urban regeneration REITs, it manages a total of 11 REITs.
The issue is the revenue structure. Public rental housing REITs can recover invested capital by selling assets after the lease term ends. However, given the nature of public housing, the management period spans decades, so it takes considerable time to realize capital gains. The management periods of Seoul REITs Nos. 1–4 range from at least 20 years to as long as 30 years. In fact, the four REITs are currently posting net losses, and cash-like assets are also declining.
Because of this, there is said to be a consensus within SH that it should move beyond operating existing public rental REITs and develop a new business model. Accordingly, SH has begun analyzing the current business structure and reviewing new revenue models. However, such new businesses will likely differ in nature from short-term, profit-seeking investments typically expected by private financial firms.
The industry sees a high likelihood that the new revenue businesses SH is reviewing will be medium- to long-term models premised on policy objectives. The approach is to secure limited revenue while maintaining the public rental and public support character by improving operational efficiency, advancing asset management, and linking with public development projects. In this case, policy suitability and sustainability will inevitably take precedence over profitability.
In such a business structure, conflicts of interest with private financial firms over profitability are expected to be unavoidable. If SH secures 100% equity in Seoul Investment Management through a call option, it can secure autonomy in promoting projects and making decisions based on policy judgment and can design a revenue structure from a medium- to long-term perspective, which observers say is meaningful from a strategic standpoint.
The government policy environment is also lending momentum to this move. In its housing supply measures announced in the second half of last year, the government said it would start construction on 21,000 public-supported private rental dwellings in the Seoul metropolitan area by 2030 and invest a total of 22 trillion won in public housing supply. With the Lee Jae-myung administration continuing its stance of expanding public housing supply, the volume of rental housing REITs is expected to increase. Capital commitments to rental housing REITs are set to rise from 450 billion won last year to 720 billion won this year.