Koramco Life Infrastructure REITs Reduces Gas Station Investment Ratio... Portfolio Improvement

Koramco Asset Trust announced on the 24th that ‘Koramco Life Infrastructure REIT’ will officially begin work to improve its asset portfolio by selling 13 gas stations located in Seoul and the metropolitan area.

The sale targets include ▲Yangcheon Gas Station in Mokdong, Seoul ▲Arirang Gas Station in Jeongneung-dong, Seoul ▲Daejeon Government Complex Gas Station in Dunsan-dong, Daejeon ▲Dream Self Gas Station in Gwangsa-dong, Yangju ▲Hyangnam Hyundai Gas Station in Hyangnam-eup, Hwaseong ▲Pocheon Daero Self Gas Station in Soheol-eup, Pocheon ▲Saemteo Gas Station in Yeongok-myeon, Gangneung ▲Seowon Gyeongju Gas Station in Bongmyeong-dong, Cheongju ▲Retail Complex Facility in Daeyeon-dong, Busan ▲Uam-ro Self Gas Station in Uam-dong, Busan ▲Hamwol Self Gas Station in Seongan-dong, Ulsan ▲Geukdong Self Gas Station in Seokjeon-dong, Changwon ▲Hanam Jeil Gas Station in Docheon-dong, Gwangju, totaling 13 key assets nationwide.

To enhance competitiveness in the market, assets with high development potential and those with low operational efficiency will be bundled and sold as a package. Among the package sale assets, Yangcheon Gas Station is located just 3 minutes from Sinmokdong Station and is adjacent to the Han River and Nodeul-ro, offering significant future development value. Additionally, Daejeon Government Complex Gas Station is near Galleria Department Store Timeworld branch, situated at the entrance of Daejeon’s largest commercial district, highly valued for its location. Therefore, if one wishes to purchase Yangcheon or Daejeon Government Complex Gas Stations, participation in the bid must include other assets as well.

Koramco Life Infrastructure REIT is Koramco Asset Trust’s flagship listed REIT that invests in physical assets such as over 140 HD Hyundai Oilbank directly operated gas stations nationwide, large home appliance specialty stores, and mega logistics centers, as well as prime office preferred shares including Seocho Majesta City Tower and Gangnam Station DF Tower.

At the time of its listing on the KOSPI market in 2020, all held assets were related to gas stations, but it is rapidly diversifying its assets under the concept of an ‘investment platform.’ The asset sale is part of portfolio adjustment, aiming to reduce the proportion of gas stations by selling about 10% of the remaining 140 gas stations and expanding investments into various new businesses. The REIT’s investment proportion in gas stations is about 61%, which will be adjusted to approximately 58% after the sale is completed.

The REIT is actively pursuing a shareholder return policy through a capital recycling strategy, selectively selling existing assets to pay special dividends and reinvesting the recovered principal into new assets expected to yield higher returns. Over the past three years, it has paid special dividends from capital gains, exceeding the target dividend rate of 6.2%. Using the recovered principal, it acquired the Aneuk Hotel Hongdae branch, a corporate-type small to medium-sized hotel, in July. Recently, it also purchased a self-owned parking tower worth 10 billion KRW without a paid-in capital increase. The overall dividend stability of the REIT is expected to be strengthened.

Lee Jang-hyuk, Head of Koramco Life Infrastructure REIT’s General Management, stated, "Koramco Life Infrastructure REIT will commence regular special dividend operations for active shareholder returns through various sale strategies." He added, "As a multi-sector investment platform with sustainable growth, Koramco Life Infrastructure REIT will provide investors with returns that exceed expectations through proactive management, not merely remaining a simple real estate investment company."

Koramco Life Infrastructure REIT has selected three joint lead managers for the sale: Real Estate Planet, Oscar & Company, and Cushman & Wakefield. Detailed information regarding the package sale and bidding can be found on the Koramco Life Infrastructure REIT website.