According to relevant industry and real estate investment baking industry sources on March 14, Kumho Asiana Group signed a memorandum of understanding (MOU) with Deutsche Asset & Wealth Management, a Germany-based global asset management company, to sell its Gwanghwamun office building in 115 Sinmunno 1-ga, Jongno-gu, Seoul.
The special-purpose company (SPC) that operates Kumho Asiana’s office building in Gwanghwamun is owned by Asiana Airlines with an 80 percent stake, KMTJ Auto with 15 percent and Dongbu Insurance with 5 percent. Deutsche Asset Management will buy the whole stake and Germany’s institutional investors will make an investment through real estate funds.
Kumho Tire had a call option for Asiana Airlines’ stake in Kumho Asiana’s Gwanghwamun office building but didn’t exercise the right. Asiana Airlines, which saw its financial structure get worse, has decided to sell the office building to secure liquidity.
Kumho Asiana will take on lease the Gwanghwamun office building in the future. The sale price will vary depending on a term of lease. Considering recent sale prices of large office buildings in downtown, it is expected to be sold from some 400 billion won (US$375.76 million) to about billion won (US$469.7 million). However, the price of the office building will go lower to little over 400 billion won (US$375.76 million) with a shorter length of lease. Kumho Asiana can also move its office to Daewoo Engineering & Construction’s Sinmunno office building across the street, which is also owned by Deutsche Asset Management. Daewoo E&C’s lease will be expired at the end of this year.
With a total floor area of 60,695 square meters, Kumho Asiana’s Gwanghwamun office building has 29 floors above ground and 8 floors below ground. It was completed in 2008.