Koramco Leads REITs Market Revitalization with 'Anchor REITs Management Structure Reform'

[Asia Economy Reporter Park So-yeon] Koramco Asset Trust announced on the 14th that it will actively work to revitalize the domestic REITs market by restructuring the operation system of the Housing and Urban Fund Anchor REIT in collaboration with the Ministry of Land, Infrastructure and Transport and the Housing and Urban Guarantee Corporation.

The Anchor REIT is the first blind-type REIT in Korea, established in 2020 with a 300 billion KRW investment from the Housing and Urban Fund to revitalize the public real estate indirect investment market. Koramco Asset Trust, the top operator in the domestic private REITs market, is responsible for managing the Anchor REIT.

The Anchor REIT discovers high-quality domestic real estate indirect investment projects that are planned for public offering and listing, participates in initial investments, and supports these projects until they reach listing.

Koramco, under the supervision of the Ministry of Land, Infrastructure and Transport, conducted a comprehensive improvement process for the Anchor REIT by gathering diverse opinions from experts across various fields together with the Housing and Urban Guarantee Corporation to revitalize the domestic REITs market.

First, the operation structure was efficiently reorganized. For new investments, the prior consultation institutions were unified from the current two dedicated operating institutions of the Housing and Urban Fund (Mirae Asset Global Investments, NH Investment & Securities) to the Housing and Urban Guarantee Corporation to enable faster decision-making.

The scope of investment activities was also significantly expanded. The Anchor REIT’s investment range was improved to allow investment activities not only at the issuance stage of listed REITs and public real estate funds but also partially in the secondary market.

According to the improved standards, the Anchor REIT can ▲purchase shares of previously invested REITs on the stock market ▲engage in over-the-counter transactions and participate in paid-in capital increases of domestically listed REITs ▲invest in listed REITs that include overseas underlying assets.

Institutional and administrative procedures that had been obstacles to the operation of the Anchor REIT have also been improved.

Unlike existing REITs that invest directly in real estate, the Anchor REIT is Korea’s first blind-type REIT that invests indirectly in other listed REITs or public funds. Due to differences in regulations between the Commercial Act and the Corporate Tax Act regarding dividend calculation, there was a possibility of disadvantages to investors.

A Koramco official stated, "According to the 'REITs System Improvement Plan' announced by the government last month, special improvements to the dividend regulations related to the Anchor REIT have been reflected, so these institutional issues are expected to be resolved soon. Additionally, the approval procedures that the Anchor REIT had to undergo each time it made an investment have been simplified to post-reporting, which is expected to further strengthen the investment competitiveness of the Anchor REIT."