Keppel acquires office tower in Seoul’s CBD for $228.7 mil
Keppel Land Limited, Keppel Asia Macro Trends Fund IV (KAMTF IV) and KB Bank Discretionary Fund, have entered into shareholders’ arrangements (SHA) with the joint venture firm (JVCo), Gaenari (IV), in connection with the recommended acquisition.
Keppel Corporation, on Dec 19, announced that it has proposed to acquire Samhwan Building, an estate 15-storey workplace tower found in Seoul, South Korea, at a transaction rate of KRW220 billion ($228.7 million).
“As the organization and economic hub of South Korea, Seoul has actually seen a rising interest for high quality office spaces in the city. We are pleased to collaborate with Keppel Land on the procurement of Samhwan Development, a distinctively located prime asset in the core of the main business district, which is wellpoised to catch this increasing interest. Keppel Funding has managed near to $3.4 billion of properties with gross floor location of 6.2 million sq ft in South Korea since 2004, and we are confident that our seasoned group, active possession administration on the ground plus robust worth creation techniques, will certainly allow us to produce excellent returns for our funds’ clients,” claims Christina Tan, CEO of Keppel Capital.
Samhwan Establishment at the moment has an overall entire level area (GFA) of 31,403 sqm. It is located in Seoul’s main downtown (CBD) of Jongno-gu and surrounded by Korean royal residences in the UNESCO World Heritage List. The property controls unmatched views of the surroundings. It is a three-minute walk from the Anguk Station on the Seoul Train line 3, and a 30-minute drive from the different crucial business centers of Gangnam and Yeouido in Seoul.
Upon the finish of the transaction, in which is schedule to occur by the end of December, Keppel Land will likely hold a 39.5% efficient interest in Samhwan Building, whilst the maintaining 31.1% and also 29.4% efficient risks will certainly be acquired by KAMTF IV and KB Bank Discretionary Fund specifically.
KAMTF IV and also KB Financial Institution Discretionary Fund are managed by Alpha Investment Partners Limited and even Keppel Investment Management Co., Ltd respectively. Alpha Investment Partners and Keppel Investment Management Co. are both wholly-owned part of Keppel Capital Holdings.
Keppel, in its report, claims it will be including sustainability attributes, such as high-performance facility exteriors, energy-efficient air conditioning and heating systems, brilliant lights systems, indoor environmental top quality monitoring along with smart structure controls, to boost the property’s operational efficiencies as well as efficiency.
“When refurbishment efforts are finished, Samhwan Property will certainly be a masterpiece in South Korea of Keppel Land’s Lasting Urban Renewal capacities, which leverages digital innovations to retrofit, future-proof and even extend the lifespan of commercial buildings,” Lim includes.
“Keppel Land is delighted to broaden into South Korea via the purchase of Samhwan Property in partnership with the exclusive finance under Keppel Capital. This mutual financial investment not only uses the group’s corresponding strengths throughout real estate services and asset supervision yet even enhances Keppel’s asset-light organization design which make use of third-party funds for growth,” says Louis Lim, Chief Executive Officer of Keppel Land.
When the real estate has been purchased furthermore once the relevant governing license has indeed been gotten, Keppel will definitely carry out possession improvement efforts (AEIs), which include a horizontal extension, to broaden the structure’s leasable office space. A refurbishment of the building’s existing spaces will also be conducted in a bid to enhance the building’s value.
Under the SHA, Keppel Land and KAMTF IV will sign up for stakes in the JVCo, and are going to have a shareholding interest rates of about 55.93% and also 44.07% respectively. Both Keppel Land and also KAMTF IV will furthermore prolong investors’ loans of roughly US$ 113.2 million ($153.8 million) to the JVCo and also carry out an extra funding investment of up to US$ 4.84 million, in measurement to their shareholding interest, for the purchase of the property.
Stocks in Keppel Corp closed at $7.33 on Dec 16.