Keppel’s private funds acquire Bank of Korea’s Sogong Annex Facility in Seoul

Felicia Tan
3-min read
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The move brings Keppel’s AUM in South Korea to around 2.6 trillion Korean won.

Keppel Corporation has, through its private funds, Keppel Asia Macro Trends Fund IV (KAMTF IV) and a co-investment programme (CIP) committed by a leading Korean financial institution, acquired the Bank of Korea's Sogong Annex Facility in Seoul’s central business district.

Including the latest acquisition, Keppel has closed over 1.4 trillion Korean won ($1.5 billion) worth of deals in South Korea since 2021. The move also brings the group’s South Korean assets under management (AUM) – which includes the Samhwan Building and waste management company, Eco Management Korea Holdings – to almost 2.6 trillion Korean won.

KAMTF IV and the CIP will each hold an effective interest of 50% in the Sogong Annex Facility which comprises a 13-storey office building with adjacent parking facilities. The property, which was originally built as the headquarters for the Korea Commercial Bank, spans a total gross floor area (GFA) of 15,750 sqm (169,531.59 sq ft).

It is located at the intersection of Myeongdong and Namdaemun in Seoul’s CBD, and is surrounded by offices of various large enterprises and financial institutions, including the Bank of Korea. The property is also accessible via public transport and is within close proximity to the City Hall and Myeongdong subway stations.

Keppel will implement asset enhancement initiatives (AEIs) for the property which includes upgrading its façade and interior spaces. The group will also undertake an active lease management to optimise occupancy and achieve higher rents as well as leverage its real estate division’s sustainable urban renewal (SUR) expertise to improve the asset’s operational efficiencies and performance.

“Keppel is excited to continue contributing to the renewal of Seoul’s urban landscape. Similar to how we are refurbishing Samhwan Building, acquired last year jointly with Keppel’s private funds, we will leverage digital technologies to retrofit and future-proof the Sogong Annex Facility,” says Louis Lim, CEO of Keppel’s real estate division.

“We will also be incorporating features such as a high-performance building facade, efficient cooling and heating systems, as well as LED lighting systems to enhance the building’s sustainability performance and indoor environmental quality. We are confident that the attractiveness and overall value of the asset will be greatly enhanced when refurbishment works are completed,” he adds.

“Keppel has established itself as a premier asset manager in South Korea, having cumulatively managed about $5.3 billion of assets in the country since 2004, and realising robust returns that exceeded our targets for the assets that were divested,” says Robert Sung, Keppel’s chief representative in Korea.

“We are excited to continue our expansion in South Korea through the acquisition of the Bank of Korea's Sogong Annex Facility. South Korea is a market with strong fundamentals and where Keppel sees tremendous opportunities. We expect to invest some $3 billion over the next three years across real estate, particularly where we can leverage Keppel’s value-add capabilities, as well as infrastructure assets,” he adds.

Shares in Keppel closed 1 cent higher or 0.15% up at $6.86 on July 19.

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