Staritz, a self-managed REIT, announced on the 9th that it will expand its scope from its existing hotel operation-focused REIT business to real estate development projects to secure new growth engines.
In the past, Staritz had a strong character as a trustee-managed REIT managing assets under the influence of its former largest shareholder, Modetour Network. Since the parent company, Modetour, primarily operated in the travel industry, it mainly managed hotel and real estate assets.
However, since January, the largest shareholder of Staritz changed from Modetour Network to ‘AL136,’ raising expectations for business diversification. Staritz plans to focus on its core REIT business as its interests with the Modetour Group have disappeared.
Accordingly, Staritz plans to actively promote ‘real estate development projects’ and ‘commercial facility rental income businesses.’
A company official stated, “Due to the recent real estate market downturn, some project sites are being listed at prices less than half of their appraised value,” adding, “Staritz is actively pursuing the acquisition of these sites at low prices, so-called non-performing loan (NPL) acquisition projects.”
He continued, “After acquiring these sites at low prices and normalizing them, the structure allows for long-term operational income as well as future capital gains from sales.”
To this end, Staritz recently signed a memorandum of understanding (MOU) with a domestic securities firm and is preparing to establish a private real estate fund (Real Estate PEF, blind fund) exclusively for institutional investors and participate as an investor (LP).
Staritz plans to grow steadily through an investment cycle of purchasing NPLs at low prices, timely recovery, and reinvestment. Through this, it aims to expand its managed assets to the trillion-won scale by 2030 and return profits to shareholders through a high-dividend policy. Staritz recorded high dividend payout ratios of 99.7% and 90.01% in 2022 and 2023, respectively.
Additionally, Staritz is promoting a senior housing project that allows local residents to participate in the REIT stock public offering or receive REIT stock allocations to share operational profits with the local community. It also plans to engage in data center construction projects and worker dormitory construction projects using the environmentally friendly and easily relocatable off-site construction (OSC) method.
Jang Jeong-seong, CEO of Staritz, said, “We plan to diversify assets and expand our scope by actively advancing real estate development projects,” adding, “In addition to our existing specialized area of ‘hotel operations,’ we plan to expand clinic centers and office commercial facility rental businesses.”
He further stated, “Staritz has set a company vision to achieve REIT managed assets of 1 trillion won by 2030 and subsidiary managed assets of 4 trillion won.”
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