As office development projects near Seoul Station have successively secured financing, the area around the station is emerging as a new business district. With large-scale office development accelerating even in areas long associated with a "jjokbangchon" image, observers say the Seoul Station–Yongsan corridor is poised to establish itself as a core business district alongside Gangnam, Yeouido and Gwanghwamun.
According to the real estate industry on the 21st, the Yangdong District Nos. 11 and 12 office development project in Namdaemun-ro 5-ga, Jung-gu, Seoul, recently completed 500 billion won in main project financing (PF). The main PF consists of 340 billion won senior debt, 130 billion won mezzanine debt and 30 billion won subordinated debt.
This project redevelops a jjokbangchon near Namdaemun in Seoul into offices. KCC E&C is handling construction of the offices, which will span from 10 basement floors to 32 stories above ground. The project matures in July 2031.
The Seoul Station north rail district mixed-use development is also accelerating its financing. Led by Hanwha Group, the project last month secured an additional 685 billion won in PF following the existing 2.105 trillion won main PF. The funds will cover construction costs and repay existing borrowing fund.
The north rail district mixed-use development is being pursued on idle rail land north of Seoul Station and will add offices across five buildings from six basement floors to 39 stories above ground, with a total floor area of about 340,000 square meters. After breaking ground at the end of 2024, progress has recently reached around 13%. Global hotel brand Mandarin Oriental Hotel also chose the site for its first entry into Korea.
The "IOTA Seoul" project promoted by IGIS Asset Management is also the largest office development to rise in the business district around Seoul Station. Spanning the former Millennium Hilton site (IOTA Seoul 1) and the Metro Tower and Seoullo Tower sites (IOTA Seoul 2), it has a total floor area of 460,000 square meters. For IOTA Seoul 2, IGIS Asset Management completed refinancing last month by bringing in new senior tranches from Meritz Financial Group (360 billion won) and NH Investment & Securities (130 billion won).
Office development is proceeding simultaneously in Sunhwa-dong and Seosomun-dong north of Seoul Station. Construction is underway at Seoul Station–Seodaemun District Nos. 1 and 2, Zone 1 on the former Samsung Life Insurance Seosomun Building site (about 250,000 square meters in total floor area; completion in 2030) and at Seosomun District Nos. 11 and 12 (about 138,000 square meters; completion in 2029). Bongnae District 2, being pursued as Meritz Fire & Marine Insurance's second headquarters, and Bongnae District 3, where SK D&D's new headquarters will be built, are also moving through development procedures.
The development industry is watching the potential for the Seoul Station–Yongsan corridor to grow into a new business district, "SYBD (Seoul Station & Yongsan Business District)." Around Yongsan, the Yongsan International Business District development pursued by the Seoul Metropolitan Government, KORAIL and SH, as well as Seobu T&D's mixed-use project, are underway.
As the three major business districts in Seoul—Gangnam, Yeouido and Gwanghwamun—age, the competitiveness of the Seoul Station–Yongsan area, where new offices are being concentrated, could stand out further. In fact, the average completion year of major downtown buildings in Seoul is 1991, with many now more than 30 years old.
A real estate development industry official said, "The area around Seoul Station already had the backbone of a transportation network, but development projects had not followed," adding, "As large-scale projects such as the groundbreaking of the north rail district and the refinancing of IOTA Seoul have successively hit their stride, investor interest is growing rapidly."