[THE INVESTOR] Foreign investors are snatching up Korean real estate despite uncertainties, including the North Korean nuclear threat, latest data shows.
According to US-based commercial real estate services firm Cushman & Wakefield on Oct. 13, foreigners have purchased domestic commercial property worth US$11.76 billion from the third quarter of 2016 to the second quarter this year.
The International Finance Center in Yeouido
This is a 97.6 percent jump from the same period a year ago. The rise has been attributed to global liquidity due to low interest rates.
The buying was especially concentrated in the fourth quarter last year. Brookfield Asset Management, an alternative investment company in Canada, purchased the International Finance Center in Yeouido for 2.55 trillion won (US$2.25 billion) and Morgan Stanley also acquired Susong Building in Seoul for 216 billion won from IGIS Asset Management. In addition, Blackstone purchased Capital Tower in Seoul for 480 billion won from Mirae Asset.
Foreign investors have been able to double the amount of domestic real estate purchases in the past year as a large number of buildings have been put on the market. This is primarily due to the fact that major domestic corporations and financial institutions are seeking to secure liquidity and are disposing office buildings and other properties.
According to Mate Plus, 21 of the 73 prime office buildings (28.8 percent) in central Seoul have received foreign funding, which is a drastic rise from 2012 where 12 out of 69 buildings (17.3 percent) had overseas investments.
By Alex Lee (firstname.lastname@example.org