Seoul office transaction volumes hit US$4.2b in Q3

There were several notable transactions in the prime office segment.

Office transaction volumes in Seoul hit a whopping KRW4.9 trillion (USD 4.2 billion) in Q3. This upbeat performance was driven by ample liquidity coupled by low interest rates, as well as limited outbound investment opportunities.

According to Colliers, the office market saw the completion of several transactions involving prime properties. These included deals for SK Seorin building, Twin Tree Tower, FastFive Tower and H Square Building. At the same time, investor interest in the Pangyo office market has been on the rise since the lifting of 10-year resale period restrictions in Pangyo Technovalley. Pangyo H Square, occupied by Kakao, was acquired by KOREIT from Pangyo SD-2 PFV. 

In addition, the Alpharium Building occupied by NCSoft has received considerable interest and is likely to be transacted at a higher price than expected.

Here’s more from Colliers:

A number of major transactions are likely to close before year end, including large ongoing deals such as Seoul City Tower (CBD), Alpharium Building (Pangyo) and E-mart Headquarters (Sungsu). Seoul’s Gangnam business district (GBD) is expected to continue to attract investor attention in the coming quarter. Competition for office assets is expected to continue despite concerns about a slowdown in the economy, thanks to an abundance of liquidity and low interest rates. 

However, the Bank of Korea (BOK) has highlighted the need for tighter monetary policy, suggesting another possible rate hike following the August raise of benchmark interest rates, this year. It remains to be seen if this will have a significant impact on the property market