Stable Investment Possible: Commercial Facilities with High 'Early Contract Rate' Gain Popularity

With zero interest rates maintained, commercial properties are gaining exceptional popularity in the real estate market. They offer higher returns compared to bank interest rates and, unlike stocks or cryptocurrencies, provide investors with stable monthly rental income, attracting strong interest from investors.

In this context, experts advise that targeting commercial properties with high initial contract rates, which have already been verified by investors, is also a viable strategy.

Commercial facilities that achieve high contract rates early on are highly valued for investment stability, as they have already been vetted by demanders. Industry analysis indicates that the faster a commercial property is sold out, the quicker the commercial district forms, reducing vacancy risks.

For example, the commercial facility ‘Dongtan Lake Como,’ supplied in Dongtan 2 New City in 2016, sold out all units within three days of contract opening. Now celebrating its first anniversary, this commercial facility has become a landmark in the area with various stores such as Terarosa, famous for specialty coffee, the curated shop Thingool Store, and the lifestyle bookstore Arc N Book.

An industry insider said, “For novice investors who find it difficult to analyze commercial districts and understand foot traffic, it is advisable to pay attention to the remaining units in commercial facilities that recorded high contract rates in a short period. Due to their popularity, these properties have a high potential for premium formation, allowing investors to expect both stable rental income and capital gains.”

Recently, a large-scale commercial facility launched in a prime location in Gwanggyo New City has attracted investors’ attention by achieving a high contract rate in a short period.

‘Hills Avenue Gwanggyo Jungang Station First,’ a commercial facility developed by Hyundai Construction in Suwon City, Gyeonggi Province, achieved a contract rate exceeding 70% within just four days of opening contracts. Considering it is a large-scale commercial facility with a total of 366 units, this is a very high initial contract rate.

In particular, the first-floor units, which were priced the highest (with a top price around 10.3 billion KRW), were also smoothly contracted, and it is expected that the remaining units will be quickly sold out.

A sales representative stated, “With solid underlying demand due to the planned relocation of public institutions such as the Gyeonggi Provincial Government new office, and being the only commercial property in the Gwanggyo residential district directly connected to the subway, investor interest has been intense. As a large construction company brand commercial facility located in a verified prime location, a quick sell-out is anticipated.”

‘Hills Avenue Gwanggyo Jungang Station First,’ expected to sell out quickly, is situated at the forefront of Gyeonggi Convergence Town, a core development project in Gwanggyo New City. Moreover, the subway and bus transfer center will be directly connected from the commercial facility’s basement, expected to attract the highest volume of public transit users.

Located right in front of Shinbundang Line Gwanggyo Jungang Station, ‘Hills Avenue Gwanggyo Jungang Station First’ will have direct connections to the station on basement level 3 and the bus transfer center on basement level 2. If this connection is confirmed, it will be the only commercial facility in Gwanggyo New City directly linked to the subway, further enhancing its value.

The efficient circulation design maximizing the influx of users from Shinbundang Line Gwanggyo Jungang Station and the metropolitan transfer center also draws attention. Escalators and elevators connecting all floors organically will create an open street mall with abundant foot traffic, without distinction between underground and aboveground levels.

Adjacent to popular outing spots such as Gwanggyo Lake Park and Suwon Convention Center, the facility is expected to attract visitors to these locations as well. Around the approximately 2 million square meter Gwanggyo Lake Park, several cultural complex facilities are concentrated, including the Suwon Convention Center capable of hosting international conferences, an aquarium, department stores, outlets, and hotels.

In particular, according to the 22nd and 23rd amendments to the Gwanggyo District development and implementation plans, the ‘Gwanggyo New City Central Business District Street Space Plan’ is scheduled, which involves constructing an underground passage connecting Gyeonggi Convergence Town to Gwanggyo Lake Park. Once completed, the underground passage is expected to naturally channel visitors of the cultural complex facilities concentrated at Gwanggyo Lake Park to ‘Hills Avenue Gwanggyo Jungang Station First.’

Developed under Hyundai Construction’s Hillstate brand, ‘Hills Avenue Gwanggyo Jungang Station First’ spans from basement level 3 to ground level 3, with a total floor area of 42,776㎡ and 366 units. It will be a landmark mixed-use commercial facility combining indoor and outdoor spaces.

Currently, some remaining units are being sold on a first-come, first-served basis, and the sales office is located in Suwon City, Gyeonggi Province. To prevent the spread of COVID-19, visits to the sales office are by prior reservation only.