Will It Bring Relief to Seoul Office Drought? 'Grade A Offices' Emerging in Magok in the Second Half of the Year

This year, a large number of Grade A offices available for external lease will be completed in the Magok district of Seoul in the second half of the year. It is expected to be a boon to the Seoul office market, where new supply is insufficient compared to demand.

Perspective view of a Grade A office (complex facility) to be completed in the Magok district in the second half of this year. / Image provided by Cushman & Wakefield

According to Cushman & Wakefield on the 23rd, 'Le West City Tower' (total floor area of 326,072.7㎡) will be completed in September at CP1 block in the Magok district. It is a facility with 7 basement floors and 13 above-ground floors, used for office space, convention, and hotel purposes. The monthly rent per 3.3㎡ is about 93,000 KRW, and the maintenance fee is about 41,000 KRW. It is located near Magoknaru Station, and the construction company is Lotte Construction.

At CP3-2 block between Magoknaru Station and Magok Station, 'K-Square Magok' with a total floor area of 159,287.6㎡ and 7 basement floors to 12 above-ground floors will be built. Lotte Construction is scheduled to complete it in September, and the leased floors are known to be from the 4th to the 11th floors above ground. The expected monthly rent and maintenance fee per 3.3㎡ are 95,000 KRW and 43,000 KRW, respectively. On both sides of this building, a senior town and residential lodging facilities will be established.

Right in front of Magok Station, a complex facility called 'One Grove' (CP4 block, total floor area of 463,098.5㎡), about three times the size of Seoul World Cup Stadium, will be constructed. The construction company is Taeyoung Construction. It will have 7 basement floors and 11 above-ground floors, with floors 3 to 11 above ground used as office space, and floors from basement 2 to above ground 2 will house a mall. E-Mart Traders has confirmed its entry, and flagship stores and fine dining establishments will be included. The monthly rent per 3.3㎡ is about 98,000 KRW, and the maintenance fee is about 37,000 KRW.

A Cushman & Wakefield official said, "Magok area offices can be divided into those used as company headquarters and those available for external lease," adding, "The total leasable floor area of these offices to be completed in the second half of the year is 190,000 pyeong, which is about 42% of all Grade A offices in Magok."

The Magok district began development as Seoul city decided to foster seven sub-centers in addition to the existing three downtown areas of Jongno, Yeouido, and Gangnam. It was previously an undeveloped area designated as a height restriction zone due to its proximity to the airport. Currently, Magok district consists of about 3.7 million ㎡ of land divided into three zones (Zone 1 residential complex, Zone 2 industrial and office complex, Zone 3 park complex), with office-related areas accounting for the majority.

The official added, "Considering office inventory and other factors, the Magok area has an actual occupancy rate about 30-50% lower compared to the downtown area (CBD), Yeouido area (YBD), and Gangnam area (GBD)," and said, "It is a tenant-favorable market, making it attractive to cost-sensitive companies."