[Click eStock] "Samsung FN REITs, Entering Full Growth Trajectory with Samsung Fire & Marine Insurance Pangyo Office Acquisition"

Korea Investment & Securities evaluated on the 9th that Samsung FN REITs (Real Estate Investment Trust) has begun full-scale growth through the acquisition of the Samsung Fire & Marine Insurance Pangyo office building via a paid-in capital increase.

Samsung Fire & Marine Insurance - Head Office Cornerstone

Samsung FN REITs announced a paid-in capital increase worth 66 billion KRW. The newly issued common shares total 13.75 million shares, accounting for 17.8% of the total issued shares. Adding secured loans of 72.2 billion KRW, a total of 141 billion KRW will be raised. The raised funds will be used to acquire the Samsung Fire & Marine Insurance Pangyo office building.

Nam Chaemin, a researcher at Korea Investment & Securities, stated, "Samsung FN REITs has managed its dividend yield (DP) by transferring capital reserves to dividend resources to prevent it from falling below a certain level," and added, "Even after the capital increase, DPS will be stably maintained using the same method."

He also said, "As the REIT acquires new assets, operating income will increase, and interest expenses will decrease due to the decline in variable interest rates on secured loans taken out to purchase the building," forecasting, "With reduced interest burden and increased asset yield, dividends will increase significantly."

He evaluated, "The Samsung Fire & Marine Insurance Pangyo office building has stable asset value and rental income due to strong demand in the Pangyo office market." For example, "The Pangyo office building is fully leased by Hanwha Systems, and from January next year, the monthly rent will increase to 85,000 KRW per pyeong," adding, "The office vacancy rates in Bundang and Pangyo areas are also very low, at 0.8% and 0.5% respectively as of the second quarter of this year, both under 1%."