The Group's Fifth Financial Affiliate
Entry into the Commercial Real Estate Market
Hyundai Alternative, the fifth financial affiliate of Hyundai Motor Group and an asset management firm specializing in alternative investments, has officially launched.
On May 23, Hyundai Alternative announced that it recently received approval from the Financial Services Commission to register as a general private equity fund manager and has commenced operations.
Hyundai Alternative is the fifth financial company under Hyundai Motor Group, established with Hyundai Card and Hyundai Commercial investing 51% and 49% of the shares, respectively.
The company plans to focus on alternative investment sectors such as real estate and non-performing loans (NPLs), leveraging its team of professionals and systematic investment strategies.
Alternative investments are effective for portfolio diversification and tend to offer higher returns compared to traditional assets such as stocks and bonds, making this market attractive to institutional investors.
According to the alternative investment industry and global consulting firms, assets under management (AUM) in the alternative investment sector, which stood at $20 trillion (approximately KRW 2,806 trillion) in 2022, are expected to increase to $29 trillion (approximately KRW 4,029 trillion) by 2027.
Hyundai Alternative's business areas are divided into real estate physical investment, private debt funds (PDFs), and NPLs.
First, real estate physical investment targets high-quality commercial real estate such as office buildings, data centers, and hotels. Through these investments, the company aims to secure stable cash flows from rental income and realize capital gains from asset appreciation.
The company is also entering the rapidly growing PDF market. PDFs are funds in which asset managers lend capital collected from investors to corporations and other entities. The focus will be on real estate project financing (PF) for residential complexes and office buildings, as well as commercial real estate-backed loans and corporate finance.
Hyundai Alternative also plans to expand its capabilities in the NPL sector. The company will operate across a variety of NPL segments, including secured NPLs related to rehabilitation and workouts, as well as unsecured NPLs such as individual rehabilitation and credit recovery claims.
Hyundai Card, which invested in Hyundai Alternative, is transforming itself into a fintech company through investments in digital and artificial intelligence (AI) sectors and by securing human resources. Hyundai Commercial is expanding its influence in the alternative investment field through its corporate finance business.
Industry experts believe that the business capabilities of Hyundai Card and Hyundai Commercial, the major shareholders, will serve as a foundation to enhance Hyundai Alternative’s competitiveness.
Hyundai Alternative is also making efforts to secure talent. The organization has been formed around professionals such as Lee Yongkyu, former Deputy CEO (Executive Director) of Capital Markets at Mastern Investment Management, as well as appraisers and certified public accountants who have long been recognized for their expertise in the alternative investment industry.
A representative from Hyundai Alternative stated, "As the fifth financial company of Hyundai Motor Group, we will provide clients with stable investment opportunities through refined data analysis and highly reliable research, and we aim to grow into a leading asset manager in the alternative investment market."
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