Six retail units in "Wirye 2nd I'Park" in Jangji-dong, Songpa-gu, Seoul, have been put up for bulk public sale. "Wirye 2nd I'Park" is a complex in a prime spot in Wirye New Town, and all the units up for public sale are on the first floor.
Half of the retail units currently up for public sale were not sold off by the developer NeoValue but kept in-house. Industry officials expect the developer failed to pay the interest on its loans, pushing the assets into public sale. NeoValue oversaw the mixed-use complex Nuditt Hongdae in Seogyo-dong, Mapo-gu.
According to the auction and public sale industry on Dec. 15, Hana Asset Trust has been conducting a public sale since Dec. 10 for units 123, 124, and 125 in Building 1; units 103 and 127 in Building 2; and unit 108 in Building 3 of the Wirye 2nd I'Park retail. All the properties up for public sale are first-floor units classified as Type 1 neighborhood living facilities (resting restaurants) and Type 2 neighborhood living facilities (tutoring centers, private academies). Based on exclusive-use area, the same concept as exclusive area in apartment housing, they range from 46.36㎡ to 98.01㎡. The minimum bid prices range by property from a high of 2.467 billion won to a low of 862 million won, totaling 8.252 billion won.
Wirye 2nd I'Park is a complex in Wirye New Town around 884 Jangji-dong, Songpa-gu, consisting of seven buildings from three floors underground to 29 floors above ground, with 495 households of 90–115㎡ exclusive area. It is close to Bokjeong Station on Subway Line 8 and Macheon Station on Line 5, and is also near the Munjeong-dong law town, KTX Suseo Station, and Lotte World Tower (Phase 2) in Jamsil, earning the label "golden location." It was pre-sold in 2013 and completed in 2016.
Among the units up for public sale, units 123, 124, and 125 in Building 1 were held directly by the developer NeoValue. When the retail was created, NeoValue took out loans from investors and transferred ownership in a collateral trust to the trustee Hana Asset Trust, and after NeoValue defaulted on the debt, Hana Asset Trust launched the public sale at investors' request. An industry source said, "NeoValue appears to have failed to pay the loan interest on the retail, prompting creditors to move to recover their claims."
NeoValue rose to prominence in the development industry with the Alleyway Gwanggyo complex commercial space in Yeongtong-gu, Suwon, and Nuditt Hongdae in Seogyo-dong, Seoul. It was founded in 2006 by CEO Son Ji-ho, formerly with the investment banking (IB) division of Daewoo Securities (now Mirae Asset Securities). The company positioned itself as a lifestyle-based real estate developer distinct from conventional developers, mainly acquiring and developing project sites through special purpose companies (SPCs) or project finance vehicles (PFVs). In particular, it became known for an "operational income model," retaining and operating retail properties long-term to generate revenue, rather than the typical domestic developer model of selling off retail units after building them to recoup proceeds.
However, analysts say NeoValue's operating model was hit as the profitability of offline retail worsened after COVID-19. According to the Financial Supervisory Service, NeoValue posted an operating loss of 14.7 billion won and a net loss of 69 billion won in 2023. In June, it also received a disclaimer of opinion from Hanmi Accounting Corporation, which said it "did not receive key materials necessary to conduct the audit, including notes to the consolidated financial statements for the 2024 fiscal year."
An industry insider said, "As we went through the pandemic, non-face-to-face shopping surged, and since 2022, as the U.S. benchmark rate rose, higher lending rates and the collapse of commercial districts appeared in combination," adding, "These combined headwinds have rendered the operational revenue model NeoValue pursued virtually meaningless."
Kim In-man, head of the Kim In-man Real Estate Research Institute, said, "Wirye New Town had too much retail supply and high pre-sale prices, and it is notorious even among new town retail areas for high vacancy," adding, "It will not be easy for retail in Wirye New Town to improve going forward."