KT Builds Hotel on Former Telephone Office Site... Building Value Reaches 800 Billion Won

400 Billion Remodeling Cost Invested
Appraised Value Increased from 10 Billion to 800 Billion

KT Songpa Building

[Asia Economy Reporter Cha Min-young] Real estate giant KT is beaming with joy as the appraisal value doubled after remodeling the Songpa Telephone Office into a 5-star hotel and prime office buildings.

According to related industries on the 11th, the two KT Songpa Buildings constructed on the former Songpa Telephone Office site in Jamsil, Seoul, were recently appraised at about 800 billion KRW in the annual valuation. When it was a telephone office, the appraisal value was about 10 billion KRW, so even considering the remodeling cost of 400 billion KRW, the value has doubled.

Kang Guk-hyun, President of KT's Customer Division, explained, "The book value of the old Songpa Telephone Office was 10 billion KRW, but after investing 400 billion KRW to build two buildings, the market value grew to 800 billion KRW, doubling in value."

The Songpa Buildings are directly managed by KT Group's Real Estate Division. Last year, KT established the 'Group Real Estate Division' responsible for KT Group's real estate business development, investment, and partnerships through personnel and organizational restructuring. Currently, Hong Seong-pil, Executive Director, is in charge of the Group Real Estate Division. The Songpa Buildings, with a total floor area of 132,134㎡, consist of two buildings: a hotel building and an office building. The 37-story hotel building houses the Sofitel Ambassador Seoul Hotel Jamsil, which opened for business in September last year. This is the first domestic entry of the Sofitel brand under the Accor group. The 33-story office building has 13 floors occupied by KT Enterprise Division and the AI (Artificial Intelligence) and DX (Digital Transformation) Convergence Business Division, with other general companies also residing there.

As of the end of 2021, the land, buildings, and structures owned by KT amount to approximately 3.8332 trillion KRW on a book value basis. KT is remodeling telephone offices, which are being phased out due to advanced telecommunications technology, into hotels, offices, and rental housing. AI and IoT technologies such as Giga Genie are applied to hotels, serving as a testbed to commercialize technologies owned by KT. KT Estate, KT Group's real estate specialist company, has been developing and supplying hotels on the sites of Yeongdong, Eulji, Sinsa, and Songpa branches. In the second half of this year, 'Le Meridien' and 'Moxy Seoul Myeongdong' will be established on the Myeongdong branch site. Upon completion, the total number of rooms owned by KT will increase to 2,000.