The investment size of the domestic commercial real estate market in the second quarter has increased by more than 50% compared to last year.
On the 28th, global real estate service corporation CBRE Korea announced in its '2025 Q2 Domestic Commercial Real Estate Market Report' that the investment size in the second quarter reached 7.1143 trillion won, an increase of about 53% compared to the same period last year.
Following the first quarter, the figure surpassed 7 trillion won for the second consecutive quarter, with the cumulative investment amount for the first half reaching about 15 trillion won, exceeding 70% of last year's annual investment size.
Approximately 6.0117 trillion won, accounting for 85% of total investment in the second quarter, focused on office assets, driving the market. Among these, there were 11 transactions exceeding 100 billion won, amounting to about 5.5 trillion won in the city center and Gangnam area. Major transactions included SI Tower, KDB Life Tower, Crescendo, and BNK Digital Tower, with notable examples of strategic investors (SI) purchasing buildings from companies like CJ Group and Hyundai Motor.
The average vacancy rate of Seoul's A-grade office market recorded 2.7%, the same level as the previous quarter, while the Gangnam area (1.7%) and Yeouido area (2.8%) saw drops of 0.4 percentage points and 0.2 percentage points, respectively, maintaining stability. In contrast, in the city center, prime assets partially offset the increase in vacancies of other assets.
The effective rent rose to 37,248 won per square meter, up by 2.1 percentage points from the previous quarter, while the nominal rent increased to 39,599 won per square meter, up by 2.3 percentage points.
In the Gangnam area, the demand for transfers by financial and information technology (IT) corporations was active, leading to a rapid resolution of major prime office vacancies, while the Magok area continued to see inflows of demand from DL Group and the aviation and financial sectors, CBRE Korea explained.
The retail market continued its recovery due to the recovery of consumer sentiment and an increase in demand from foreign tourists. In June, the consumer sentiment index recorded 109, the highest since 2021, and the number of foreign visitors to Korea in the first half reached 7.2 million, an increase of 15% compared to the same period last year.
The transaction size of logistics assets in the second quarter was 296.7 billion won, showing an 84% decrease compared to the previous quarter, indicating a temporary adjustment. On the supply side, the new supply of A-grade logistics centers in the metropolitan area was limited to 168,614 square meters, marking the lowest quarterly figure since 2019, and the vacancy rate for the first half stood at 20.4%, a decline of 2.5 percentage points compared to the end of last year.
The temperature-controlled logistics centers saw leasing activities from companies like MUSINSA and LOTTE Global Logistics, while the low-temperature logistics centers showed gradual stability as demand partially recovered in locations like Icheon and Yangju.
In the hotel market, CBRE Korea projected that solid investment demand would continue for the time being as transactions proceeded, including Goldman Sachs acquiring the Mercure Ambassador Hongdae hotel for 262 billion won in the second quarter.
Choi Soo-hye CBRE Korea research managing director noted, "The second quarter commercial real estate market was a time when the actual demand from strategic investors and selective approaches from foreign capital emerged simultaneously, further solidifying the recovery trend." She added, "In the second half, stability in interest rates is expected due to a loosening monetary policy, but for the time being, there will be significant variances in revenue based on asset type and investor preferences."