Icon Yeoksam office building in Seoul

Source: CapitaLand

Icon Yeoksam office building in Seoul

M&G Real Estate said it has sold an office building in Seoul for KRW204bn (€139m), reflecting a 44% uplift in value after acquiring it less than four years ago.

ICON Yeoksam, in the Gangnam Business District of the South Korean capital, was bought by London-headquartered M&G in late 2020 from Singapore’s CapitaLand as part of its value-add “targeted strategy” in Asia-Pacific.

The new buyer is believed to be a Korean investment company.

Martin Seol, head of targeted strategy at M&G Real Estate Asia, said: “The successful transaction of ICON Yeoksam exemplifies the strength of our regional value-add investment approach involving strategic capital deployment and repositioning to realise optimal value.”

Seol said the firm was currently reviewing select new opportunities to continue to make new investments in residential, logistics and hospitality sectors in Asia-Pacific.

“Despite the headwinds in the last few years in the global office sector, Seoul’s office market remains far more resilient than most,” he said. “Seoul office net effective rents rose around 10% per annum over the last three years. It is one of the strongest markets globally.”

Daniel Cho, head of Korea real estate at M&G says, “South Korea is a key component of our investment strategy and we are continuously seeking opportunities for substantial value growth. This transaction marks a significant achievement in our ongoing engagement with the Korean market.”

The news comes a week after Blackstone sold a prime office building in Seoul for KRW792bn to Koromaco Reits Management & Trust.