The office development project in Yeoksam-dong, Gangnam-gu, Seoul, which had run into noise during the public sale process, has gotten on track. A real estate investment company (REITs) operated by Korea Real Estate Investment & Trust Co. (KOREIT) will pre-purchase this office for 790 billion won. After its completion in 2028, it is expected to be used as the headquarters of NEXON Games.
According to the investment banking (IB) industry on the 13th, K-One No. 32 Entrusted Management Real Estate Investment Company, operated by Hantoshin, signed a pre-purchase contract last month for an office to be built at 832-21 Yeoksam-dong. The purchase price is 792.6 billion won. K-One No. 32 Entrusted Management REITs plans to transfer ownership along with the balance after completion in Nov. 2028.
The appraised value of the office is 894.1 billion won, meaning K-One No. 32 Entrusted Management REITs will buy the office about 100 billion won cheaper than the appraisal through the pre-purchase.
This office, to be built in the Gangnam Business District (GBD), will have a total floor area of 51,887㎡ (15,695 pyeong), 17 floors above ground, and seven floors underground. The floor area ratio is 959.88%, and the building-to-land ratio is 59.97%. KT Estate and LaSalle Asset Management are the developers, and CJ Logistics' construction division is in charge of construction.
K-One No. 32 Entrusted Management REITs secured Pacific No. 88 General Private Real Estate Investment Trust, which includes participation from the Korea Scientists & Engineers Mutual-aid Association, as an institutional investor. The trustee is Woori Bank. The Korea Scientists & Engineers Mutual-aid Association is said to have exercised its right of first refusal on this office it previously held.
A Korea Real Estate Investment & Trust Co. (KOREIT) official said, "An institutional investor came in through a paid-in capital increase early this month," and noted, "We are making the purchase of the office through the REITs."
The site experienced severe ups and downs during development. Although office development had been pursued since 2021, in 2024 the financial authorities carried out restructuring of bad project financing (PF), and the site went to public sale. At the time, as the mezzanine and subordinated lenders, excluding the senior lender, failed to recover their loans, a provisional injunction was filed to prohibit the disposition of the real estate, and issues arose such as the suspension of the public sale process. Ultimately, in the same year, KT Estate and LaSalle Asset Management bought the site. About two years after KT Estate and LaSalle Asset Management began development, a buyer for the office was found.
This office investment is seen as driven by the growth potential of GBD, one of Seoul's three core business districts. While there have recently been few prime office listings in GBD, investment demand continues to grow due to low vacancy rates. In Jan. this year, the number of commercial real estate transactions in GBD was 25, up 13.6% from the same month a year earlier. The transaction amount was 521.4 billion won, outpacing other business districts (CDB and YBD). Compared with Jan. last year, the transaction amount increased 97.5%.
This office will also be used as the headquarters of NEXON Games once completed. After about a four-month fit-out period following completion, NEXON Games will lease the entire office for 10 years. Considering the completion date, NEXON Games is expected to move into this office in the first half of 2029. A NEXON Games official said, "We plan to transfer to the office under construction in Yeoksam-dong."