Koramco Launches Securitization of Hyundai Motor Real Estate Assets: "Enhancing Asset Value While Retaining Business Sites"

Hyundai Motor Company to Securitize Real Estate at Key Metropolitan and Regional Sites via REITs... "Sales Network Remains Intact"
Establishing a Foundation for Financial Efficiency and Regional Mutual Growth through Asset Securitization

Koramco Asset Trust announced on January 6 that it will officially launch a real estate asset securitization project for Hyundai Motor Company's major business sites nationwide.

The project targets Hyundai Motor Company's business sites, such as sales offices and service centers, located in major metropolitan areas in both the Seoul metropolitan area and regional cities. Koramco will establish a REIT to acquire these assets, while Hyundai Motor Company will lease back the same properties on a long-term basis through a sale and leaseback structure. This investment model is designed to enhance asset value through securitization via REITs, while allowing Hyundai Motor Company to retain its business sites.

Hyundai Motor Company will be able to maintain its existing operational structure, including its sales network, workforce, and customer touchpoints, while simultaneously improving financial efficiency and flexibility in asset management. As the asset management company (AMC) of the REIT, Koramco will oversee efficient asset management and the generation of stable rental income. Koramco and Hyundai Motor Company plan to sequentially proceed with the establishment of the REIT and asset transactions in the first half of this year.

The assets to be securitized include sales offices, customer support facilities, high-tech centers, and certified used car centers located in prime areas of the Seoul metropolitan area and major regional cities. A Koramco representative explained, "Most of the assets are situated in commercial districts within the metropolitan area, offering significant potential for value appreciation through future remodeling or mixed-use development."

In addition, the securitization of assets in regional cities is expected to inject liquidity into the stagnant local real estate markets and, through future development, contribute to regional economic revitalization and mutual growth.

Hyundai Motor Company’s asset securitization aims not only to secure short-term funds but also to optimize the company’s mid- to long-term financial structure. The funds raised through securitization will be reinvested in new growth businesses such as future mobility and electrification, thereby strengthening Hyundai’s future competitiveness.

To optimize asset management according to asset characteristics, Koramco will employ both equity-type REITs and project REITs, applying a strategy that simultaneously seeks to enhance asset value and pursue long-term operating income. Some sites will be managed as remodeling or development assets after going through the necessary permitting procedures, enabling the company to maintain its business site functions while generating mid- to long-term capital gains.

Kim Cheolgyu, Head of the REITs Division at Koramco Asset Trust, explained, "This project is characterized by its model of 'financial assetization' of Hyundai Motor Company's real estate assets, rather than simple disposal, allowing for value enhancement while maintaining stable business sites."

He added, "Based on Koramco’s expertise in real estate finance and REIT management, we will create an advanced securitization model that simultaneously realizes Hyundai Motor Company’s financial efficiency and long-term asset value appreciation."