Goldman Sachs Signs $348M Credit Co-Investment Deal with Korea Investment & Securities

Korea Investment & Securities said on 12 February that it has entered into a KRW 500 billion ($348 million) real estate loan facility with US investment bank Goldman Sachs, with a portion of the lending supporting a residential project by a top tier developer.

The facility is designed to enhance the overall risk-return profile of senior secured real estate lending and to support stable investment in high-quality senior loans, KIS said in a statement, with the partners planning to back additional property projects in the country. 

“This collaboration, which leverages Goldman Sachs’ global capital base, will serve as a catalyst contributing directly to the growth of Korea’s real estate market, industrial development, and the stable supply of real estate capital,” said Jae Joon Choi, co-country head for Korea at Goldman Sachs. 

Choi added that, “Going forward, we remain committed to providing tailored capital and strategic solutions that meet the specific needs of Korean corporate and institutional clients.”

Building on 2025 MOU

KIS said it expects the arrangement will strengthen its large-scale real estate loan origination capabilities through co-investment alongside Goldman Sachs’ liquidity and global capital base, with the two companies having signed a memorandum of understanding in May of last year to collaborate on fund sourcing, market insights, and employee exchange.

“This arrangement will allow us to provide stable liquidity through co-investment with and funding from Goldman Sachs, while further strengthening our presence in the domestic real estate market through partnership with a global institution,” said Korea Investment & Securities CEO Sung-hwan Kim. “This represents an important opportunity to solidify our position in Korea’s real estate finance market.”

The real estate credit cooperation is built around KIS leveraging its expertise and track record in the domestic real estate market to source attractive investment opportunities, while Goldman Sachs will co-invest and fund diversified assets using its international capital and property expertise, KIS said. 

In addition to devoting part of the loan facility to financing the residential project, the partners expect to incorporate into the portfolio a mixed-use resort-backed loan and a residential unsold inventory-backed loan, according to the statement. 

In the future, the facility will be used for a broader range of domestic real estate development loans and asset-backed loans, with the total investment size to be expanded progressively.

Korean Credit Catches On

With Korean residential developers struggling to meet buyer demand for new condos, lending to local builders has become big business.

Last month Hong Kong-based investment manager SC Lowy announced an MOU with Seoul-based KB Securities to loan to Korean real estate projects and corporates. That agreement was announced after SC Lowy said in September that it had won a commitment from the Abu Dhabi Investment Authority for its South Korean real estate private credit strategy. 

A year ago, Singapore’s CapitaLand Investment announced the expansion of its real estate private credit business to South Korea with the close of its first fund dedicated to the strategy. Having raised KRW 180 billion for the vehicle, CapitaLand said that it would be working with Korea Investment & Securities as co-general partners for the fund. 

In addition to its real estate lending Goldman Sachs has upped its bets on Korean property more directly through deals such as its purchase last year of the Mercure Ambassador Seoul Hongdae hotel from Hyundai Asset Management at a deal value of KRW 262 billion ($194 million).