The sale process for Barun Building, located near Samseong Station in Gangnam-gu, is set to begin in earnest.
According to the real estate industry, Aegis Asset Management, which holds Barun Building through a fund, has selected Avison Young Korea (CEO Choi In-jun) as the sales advisory firm and plans to distribute teaser letters and investment memorandums (IM) soon. The bidding is expected to take place between late May and June.
Barun Building is an office building completed in October 2009, with six basement floors and 15 above-ground floors, totaling a gross floor area of 11,349.58㎡ (3,433.25 pyeong). It is a well-known asset as the entire building has been used as the headquarters of Barun Law LLC, one of Korea's major law firms, for 10 years since 2011.
In February 2017, Aegis Asset Management launched a public real estate fund investing in Barun Building, which was fully subscribed. At that time, Barun Law LLC sold the asset to the Aegis Asset Management fund and simultaneously signed a 10-year triple net lease contract under a sale-and-leaseback arrangement, making it a high-quality office with no long-term vacancy risk, which was very popular among public fund investors.
Barun Building is located in the prime area of Teheran-ro near Samseong Station, a key station area in Gangnam, and with active development projects underway in the nearby International Exchange Complex District, it is expected to exceed recent transaction prices for properties in Gangnam.
A real estate industry official stated, “This is an attractive asset with a highly creditworthy tenant leasing the building long-term as their headquarters,” adding, “With the GTX-A line, Yeongdong-daero underground complex transfer center, and Hyundai Motor GBC development already under construction, and multiple development projects planned such as the GTX-C line and redevelopment around Jamsil Sports Complex, many companies are showing significant interest in acquiring Barun Building as these development benefits are expected to materialize during the next owner’s holding period.”
Meanwhile, Avison Young Korea is a global real estate services company and a subsidiary of Zenstar Mate, Korea’s top asset management company.
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