*This article was first published on Signal, the Seoul Economic Daily's capital markets news service, at 6:56 p.m. on March 26, 2026.*
The National Pension Service (NPS), the world's third-largest pension fund, plans to commit 600 billion won ($435 million) to domestic real estate managers. The large-scale capital injection into the real estate market is expected to trigger intense bidding competition among multiple asset managers.
According to investment banking sources on Wednesday, NPS plans to select two domestic real estate managers and commit 300 billion won to each. The fund vehicle will be an opportunistic fund, which seeks high-risk, high-return investments by developing undervalued assets such as properties with low occupancy rates to maximize value.
NPS's lending fund program was resumed in 2024 for the first time in five years. The pension fund plans to issue a public notice in the second half of this year and select delegated managers. Delegated managers of NPS's lending fund are required to operate funds that invest in domestic commercial real estate loans. When the program was relaunched in 2024, the loan-to-value (LTV) ratio was set at 70% or higher, and investment in residential properties was prohibited.
Expectations are rising in the commercial office market as major institutional investors, including NPS, have recently carried out large-scale fund commitments. The Korea Federation of SMEs committed 500 billion won to Mirae Asset Global Investments, which was also selected last year as the delegated manager for Korea Post's 500 billion won core blind fund.
Industry participants say it is becoming increasingly difficult to attract equity investors for commercial offices due to concerns over oversupply. Holding a blind fund gives managers an advantageous position for acquiring large assets. Last year, BNK Asset Management agreed to acquire E-Mart Tower for 350 billion won but was forced to relinquish its preferred bidder status after failing to raise the required equity.
Ultra-large office properties continue to come to market this year. The K Twin Towers in Gwanghwamun, Seoul, with a gross floor area of approximately 83,878 square meters, is expected to trade at more than 1 trillion won. Additionally, Pine Avenue Building A, currently used as the headquarters of Shinhan Card, is also undergoing a sale process. Shinhan Card is reportedly seeking 800 billion won or more for the property.
Meanwhile, NPS selected delegated managers twice in 2024, committing 1.35 trillion won in August and 750 billion won in November for a total of 2.1 trillion won. That compared with just 500 billion won committed the previous year.
