LaSalle Investment Management (LIM) and a local co-investor have bought an office site in Seoul for around US$115m (€106m) – representing a 33% discount to its appraised value.
LIM, which made the acquisition for LaSalle Asia Opportunity Fund VI, was the successful bidder in the 5th round of a non-performing loan (NPL) collateral auction. The office site in the Gangnam Business District was the collateral for the loan.
The site has existing zoning to allow for the development of a 29,000sqm office project which is expected to cost US$245m.
This acquisition is Fund VI’s second foray into the office market in Korea following a high-yield loan deal last year to bridge finance a 10-storey office project in Seoul’s Seongsu district.
Steve Hyung Kim, senior managing director and head of Korea, said: “Opportunistic investing in a higher cost of capital environment has forced us to be patient and also creative in how we source attractive entry points to our acquisitions.
“On behalf of our investors, we recently closed on recapitalisations, private off-market sales, and collateral acquisitions from NPL auctions like this recent transaction which capitalises on both Gangnam’s strong office fundamentals, as well as a lowered project cost basis due to a legacy borrower and junior lender getting foreclosed.”
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