With backing from the country’s biggest pension fund, South Korea’s largest real estate fund manager has bought a $635 million prime office property in central Seoul from a fund controlled by Singaporean developer Ascendas-Singbridge, according to an announcement this week by the purchaser. The acquisition of Signature Towers Seoul by IGIS Asset Management sets a price record for office transactions in Korea’s capital this year.
IGIS is buying the property on behalf of a new discretionary core fund backed by Korea’s National Pension Service (NPS), the world’s third-largest pension fund, and a vehicle of the country’s Ministry of Employment and Labor.
Ascendas Sells a Core Seoul Office Asset
Signature Towers Seoul is located at 100 Cheonggyechun-ro in the central Jung-gu district of Seoul, near the Euljiro 3-ga station on Subway Lines 2 and 3. The mostly residential district is home to Seoul’s city hall and a famed communications tower that marks the city’s highest point.
Completed in 2011, the 17-storey twin office complex covers about 100,000 square metres of gross floor area and boasts international tenants including advertising firm Leo Burnett and public relations giant Burson-Marsteller, as well as homegrown corporates.
Ascendas-Singbridge oversaw the development, leasing and management of Signature Towers Seoul, which was held by the Ascendas Korea Office Fund 1, of which the Singaporean firm is the manager and largest investor.
Korea’s Biggest Asset Manager Gets Bigger
Jointly owned by Singapore’s sovereign wealth fund Temasek Holdings and state-owned JTC Corporation, Ascendas-Singbridge has an active presence in South Korea dating from 2002. After shedding Signature Towers Seoul, the Singaporean firm will have a portfolio of four high-quality, stabilised office assets in the Korean capital with a total commitment of S$414 million ($299.3 million), according to Ascendas-Singbridge’s corporate website.
The company, which specialises in building business parks, townships, and mixed-use developments, has assets under management across Asia surpassing S$20 billion ($14.5 billion).
Founded in 2010, IGIS manages $13 billion worth of assets on behalf of scores of Korean institutional investors, along with overseas partners including Singaporean sovereign wealth fund GIC, Hong Kong-based PAG, and Boston’s AEW Capital Management. The asset manager has raised $7.1 billion for investment so far.
Korea’s NPS, an investor in IGIS’s new real estate fund, has a total investment portfolio of $507.8 billion as of this past April. Early this year, the pension behemoth purchased a 27.6 percent stake in Manhattan’s One Vanderbilt Avenue development as part of the fund’s continuing quest for diversification into alternative assets such as real estate.
The fund said in May that alternative investments will account for about 12.5 percent of its total assets by 2018.