Commercial banks have been actively trying to sell idle real estate as they close branches, but even prime properties in key locations in Seoul are struggling to find buyers.
According to the financial sector on the 6th, Woori Bank has begun selling 14 branches, including the former Galleria Palace branch in Seoul, the Ahyeon Station branch, the former Centum Park branch in Haeundae, Busan, and the former Suwon Finance Center in Gyeonggi. All are closed branches. Based on the auction reserve prices, the total sale value reaches 177.6 billion won. Woori Bank also tried to sell 25 idle properties in June, but all failed to attract bids.
KB Kookmin Bank is also proceeding with the sale of nine idle properties nationwide, including in Seoul. Five are in Seoul, two in Gyeonggi, and one each in Daegu and Daejeon, totaling 160 billion won. Bidding ran from the 10th to the 14th of last month, but no buyers have emerged.
Shinhan Bank is also having difficulty selling idle real estate. "Shinhan Expace" in Myeong-dong, Seoul, considered a prime asset, failed to sell three times before finding a new owner recently through a private contract. Shinhan Expace is where Shinhan Bank fully remodeled its Myeong-dong Station branch in 2020 and used it as a mixed cultural space. The appraised value was 142.2 billion won, but the final sale price was reportedly in the 120 billion won range.
Shinhan Bank is selling eight properties, including an employee dormitory in Seongsu-dong, Seoul, the former Jeongneung branch, and the former Busan Station branch, but no new owners are stepping up. Some properties have been reauctioned repeatedly, and auctions are underway at prices 20% below the initial bids.
Banks are selling idle real estate to improve asset efficiency. As the share of face-to-face banking continues to decline, they are steadily closing branches and disposing of them to secure cash.
In the real estate industry, the sale market is becoming active mainly for large offices, but there are pointed remarks that small and midsize offices put up by banks are less attractive to investors. An industry official said, "High-net-worth individuals and small and midsize company Oner do not invest much in small and midsize retail or offices. This trend is expected to continue for the time being, so banks' idle real estate listings will keep piling up."