Korea’s NPS Buying Incheon Shed From Straits Trading, IGIS for $300M

Singaporean conglomerate Straits Trading has agreed to sell its 47.3 percent stake in an Incheon warehouse in a deal valuing the asset at KRW 432 billion ($300 million), with market sources confirming the buyer as Capstone Asset Management on behalf of South Korea’s National Pension Service.

The six-storey Arenas Yeongjong Logistics Center provides 191,000 square metres (2 million square feet) of lettable dry warehouse and office space, Straits Trading said late last week in a release. The shed is currently held in the Sky Logis joint venture between the SGX-listed group’s Straits Real Estate platform and Seoul-based IGIS Asset Management.

Straits Real Estate and IGIS set up the JV in 2019 to develop a portfolio of logistics facilities with a combined initial capital commitment of S$220 million (then $162 million). Straits Trading expects to receive net proceeds of KRW 95.4 billion upon completion of the Incheon divestment, the company said Friday.

“This transaction underscores our disciplined approach to capital allocation and our commitment to managing investments through the full lifecycle,” said Straits Trading chairman Chew Gek Khim. “With this divestment, we are realising the value of a matured asset and reallocating capital towards opportunities that support our long-term portfolio strategy.”

93% Occupied

The 2021-built Arenas Yeongjong Logistics Center is located 8 kilometres (5 miles) from the cargo terminal of Incheon International Airport. The ramp-up facility is accessible from the Incheon International Airport Expressway connecting the airfield to Seoul.

Arenas Yeongjong benefits from occupancy of around 93 percent and a diversified, creditworthy multi-tenant base that includes Musinsa, Samsung Logitec, Qxpress and Thermo Fisher Scientific, said Judy Jang, executive director and head of research for Korea at US real estate agency Newmark. Its location supports demand from e-commerce, 3PL and air-cargo-related users, differentiating it from more generic inland logistics stock, she said.

“From a market perspective, the transaction reflects renewed domestic institutional interest in stabilised logistics assets with clear income visibility, following a period of subdued activity driven by higher interest rates and supply concerns,” Jang told Mingtiandi.

The asset is changing hands for KRW 2,261,780 ($1,569) per square metre of lettable area. On a project-level basis, the investment in Arenas Yeongjong delivered an internal rate of return in excess of 20 percent and an equity multiple of over 3 times in Singapore dollar terms, according to Straits Trading.

Completion of the disposal is subject to customary conditions and is expected to take place on or around 29 January.

Warming to Warehouses

NPS’s splash comes after KKR finished up 2025 with the purchase of the Cheongna Logistics Center in Incheon from Brookfield Asset Management for KRW 1 trillion in South Korea’s largest-ever single-asset logistics deal.

With the 427,354 square metre facility fully leased to tenants including South Korean e-commerce giant Coupang and convenience store chain Emart24, the Manhattan-based fund manager positioned the investment as a bet on the role of logistics real estate in the ongoing transformation of the country’s economy.

That buy followed a third-quarter deal in which Manhattan-based KKR agreed to pay KRW 270 billion to purchase the Coupang-leased Logisco Hwaseong warehouse from Invesco. Both transactions were managed through KKR’s local Kreate affiliate.