Emart Tower Draws Bids From Hana, Hanwha, Shinhan REITs

Korea Investment Real Asset Management, Hanwha REIT, and Shinhan Alpha REIT have entered the bidding war for Emart Tower, a deal that fell through last year.

Five to six bidders participated in the auction held Tuesday, according to investment banking sources. Genstar Mate and Cushman & Wakefield Korea are managing the sale.

Completed in 2007, Emart Tower is a prime office building located at 37 Sejong-daero 7-gil, Jung-gu, Seoul. The property comprises 19 floors above ground and six basement levels, with a gross floor area of approximately 34,173 square meters.

Emart, a major Korean retail conglomerate, currently occupies about 98% of the building. The lease runs through February 2033, making it an attractive investment for institutional investors including REITs and blind funds.

The area is seeing new headquarters buildings from Samsung Life Insurance, JB Financial Group, and Meritz Fire & Marine Insurance. Major development projects are also underway, including the Seoul Station northern district, Hilton Hotel site redevelopment, and Seoul Station mixed-use development.

The building offers excellent transportation access, within walking distance of Seoul Station, City Hall Station, and Chungjeongno Station.

Seller NH-Amundi Asset Management selected BNK Asset Management as the preferred bidder last August, but the deal never closed. BNK Asset Management offered more than 35 million won per pyeong (3.3 square meters) but ultimately withdrew after failing to secure equity funding.

Rather than continuing negotiations with runner-up NH REIT Management, NH-Amundi Asset Management opted to relaunch the bidding process. The company acquired Emart Tower from ARA Korea Asset Management for 252 billion won in 2020 and is expected to realize gains of approximately 100 billion won after six years of ownership.

The final sale price is expected to fall below 35 million won per pyeong.