FOREIGN CAPITAL CONTINUES TO ENTER KOREA IN SEARCH OF HIGHER RETURNS

Foreign investors purchased US$2.8 billion worth of commercial real estate in Korea in 2017, a decline of 48.1% y-o-y, due mainly to a lack of big ticket deals. Despite the lower transaction volume, foreign investors retain a strong appetite for Korean property as they seek to diversify their investment portfolios and secure returns that are higher compared to other mature markets in the Asia Pacific.

GROWING INTEREST FROM INDIVIDUAL INVESTORS SEEKING OPPORTUNITIES OVERSEAS

Korean outbound real estate investment has risen by a CAGR of 11.1% over the past five years. Investors are demonstrating a strong preference for office assets in major markets, with such deals accounting for 88% of total outbound investment volume in 2017. Other key criteria include assets with guaranteed long term master leases and properties located in markets with strong fundamentals and solid leasing demand.