Interview with Korea Representative of Nubin Asset Management, a Subsidiary of TIAA
City-Level Approach Rather Than Country-Level... Seoul Identified as a Key Hub
Transition from Jeonse to Monthly Rentals... Growing Potential in the Residential Real Estate Market
Nubin Asset Management, recognized as one of the world's top five real estate asset managers, is turning its attention to the domestic residential real estate market, particularly in Seoul. The company’s strategy is to focus on the market’s limited supply and the structural shift from jeonse (lump-sum deposit leases) to monthly rentals.
One of the World’s Top Five Real Estate Investment Giants... City-Level Rather Than Country-Level Approach
Jaeho Jang, Managing Director and Korea Representative of Nubin Asset Management, emphasized this point in a recent interview with The Asia Business Daily at the company’s Korea office in Yeouido, Yeongdeungpo-gu, Seoul.
Nubin Asset Management is a subsidiary of the Teachers Insurance and Annuity Association of America (TIAA), managing assets totaling 1.4 trillion dollars (approximately 2,056 trillion won). Bonds account for 40% of its portfolio, equities about 30%, and alternative investments-a significant share for a comprehensive asset manager-make up the remaining 30%. The company’s particular strength lies in real estate. As a real estate asset manager, it is ranked among the top five globally in both scale and expertise.
After graduating from Seoul National University with a degree in architecture, Jang worked at Samsung C&T before joining TIAA, the parent company of Nubin Asset Management, in 2006. Since 2017, he has been with Nubin Asset Management, overseeing the Hong Kong and Korea regions.
Under Jang’s leadership, Nubin Asset Management has managed funds from Korean institutional investors since 2014, primarily investing in overseas bonds and real estate. Since 2019, the company has also begun making direct investments in domestic real estate assets. It currently holds three logistics-related assets and one office building asset.
Unlike other firms, Nubin Asset Management approaches investment not at the national level, but at the city level within each country. The company believes that each city has its own unique characteristics and that megatrends manifest differently in each urban context. Nubin Asset Management applies meticulous criteria when selecting cities-considering not only economic size and core industries, but also factors such as international flight connectivity, female labor participation rates, and educational standards.
Focus on Korean Residential Real Estate... Unlimited Growth Potential
Seoul is one of 11 major Asian investment cities identified by Nubin Asset Management. Jang explained, “The Seoul office market demonstrated remarkable resilience, recovering swiftly even during the COVID-19 pandemic. Geographically, the limited supply made the market highly attractive from both the supply and demand perspectives. With a shortage of new office supply, we determined that carefully selected existing assets could generate stable returns, which led us to begin investing in this market.”
Recently, the company’s interest has expanded from commercial to residential real estate. This is due to both the restricted supply and detectable structural changes. Jang noted, “Because of the jeonse system, the monthly rental market in Korea has been much less developed than in other countries. However, we are now seeing a transition from jeonse to monthly rentals.” According to the Ministry of Land, Infrastructure and Transport, as of September, monthly rentals accounted for 65.3% of all nationwide lease transactions. Compared to the same month last year, jeonse transactions decreased by 1.9%, while monthly rentals increased by 38.8%.
Jang added, “Unlike the one-dimensional lease structure in which individual landlords contract directly with tenants, in the United States and Europe, it is common for corporations to own and professionally manage rental properties. Residential real estate, which forms one of the four pillars of real estate investment alongside logistics, retail, and office assets, has remained relatively quiet in Korea. This means its growth potential is virtually unlimited.”
Looking ahead, the company plans to expand into other areas it has managed, such as natural capital investments-including large-scale farms-and corporate finance such as infrastructure loans. Jang stated, “Most of Nubin Asset Management’s investments are made jointly with funds from our parent company, TIAA. We approach investments as partners, not simply as service providers, and we will continue to offer the most stable and long-term investment opportunities in the industry.”
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