Hyundai E&C will partner with real estate developer Nexplan to develop the former Le Meridien Hotel site in Yeoksam-dong, Gangnam District, Seoul, into a hotel-officetel mixed-use complex.
As part of the restructuring, they will also pursue design changes to raise the maximum height from 36 stories to 43 stories and increase the officetel to 136 units and the hotel to 208 rooms.
According to the construction industry on the 27th, on the 26th last month Hyundai E&C, Nexplan and others restructured the existing project company, Mastern No. 116 Gangnam Premier PFV, into B120 PFV. They also extended a 960 billion won bridge loan to a maturity date of on the 26th next month.
Hyundai E&C took steps to provide credit support to both serve as the builder for the development and facilitate smooth financing. On the 24th last month, Hyundai E&C decided to provide a joint guarantee of about 1.52 trillion won to obtain a loan of about 1.27 trillion won needed for bridge loan repayment and site preparation work. It also plans to sign agreements not only for completion guarantee and commencement guarantee but also for funds replenishment.
They will also strengthen the project's viability through design changes. The Gangnam Le Meridien Hotel site development project is a plan to build a mixed-use complex of officetels, a hotel, and ancillary facilities on a 10,362.5-square-meter site at 602 Yeoksam-dong, Gangnam District, Seoul.
B120 PFV plans to pursue a design change that raises the project from the current 8 basement levels and 36 above-ground stories to 7 basement levels and 43 above-ground stories, increasing the maximum height by seven stories. The project will also apply the "Eterno" brand.
If the project receives the Seoul city creative innovation design incentive, analysis suggests they could not only raise the number of stories but also increase the officetel from the current 132 units to 136 units and the hotel from 65 rooms to 208 rooms.
The project company and shareholder structure also changed. B120 PFV will see Nexplan secure about 50% equity, replacing Wells Advisors, the developer that was the largest shareholder of the existing project company (Mastern No. 116 Gangnam Premier PFV).
Hyundai E&C will be the second-largest shareholder with about 30% equity in B120 PFV. Mastern Investment Management, the former asset management company (AMC), has exited, and Howon Consulting is newly participating as the AMC with about 15% equity. Meritz Securities, as a financial investor (FI), will hold about 5% equity.
A Hyundai E&C official said, "We are discussing whether to extend the bridge loan once more on its maturity date next month or convert it to the main PF," adding, "We are pursuing design changes to strengthen the project's viability from the existing plan."