M&G Buys Seoul Apartments for $17.4M to Enter South Korea’s Living Sector

UK investment manager M&G Real Estate said on Tuesday that it has made its first investment in South Korea’s living sector, picking up a set of Seoul apartments for KRW 24.3 billion ($17.4 million).

The London-based unit of M&G PLC said in a statement that it has purchased a 14-storey multi-family residential building in Central Seoul’s Hwanghak-dong, Jung-gu on behalf of its Asia Pacific Living strategy, following earlier rental housing investments in Japan and Australia.

“This acquisition adds real momentum to our Asia Pacific Living portfolio,” said David Askham, director of portfolio management for the Asia Living strategy at M&G Real Estate. He added that, “As people’s preferences for city living evolve, our strength in finding and managing future-ready properties puts us in a strong position to grow across the region – while delivering sustainable returns for our investors.”

The Korean deal comes around nine months after M&G Real Estate won a $250 million commitment to its Asia Pacific living strategy from its parent group’s life insurance business. M&G has stated earlier that it plans to raise its exposure to Asian real estate to $2.5 billion. 

Nearly 100 Units

Completed in 2019, M&G’s Seoul acquisition has 95 studio and loft apartments and is located close to the central business district and leading universities, boosting its appeal with young professionals, students and expats, the company said. Local media reports indicate that M&G cooperated with local player Capstone Asset Management for the acquisition.

The property is expected to generate stable income for M&G’s investors, with further long-term growth available through upgrades to enhance quality and boost consumer appeal. Among those planned upgrades are improvements to sustainability, renovated shared spaces and a rooftop lounge.

With Seoul continuing to grow, M&G sees demand for multi-family housing on the rise, while institutionally owned rental residential properties make up less than 5 percent of the market. 

“South Korea is a stable and promising market, with strong long-term growth potential,” said Daniel Cho, head of Korea for M&G Real Estate. “Its supportive reforms and positive demographics make it an attractive place for institutional investment. We see this as a great opportunity to expand in a region that aligns with our strategy – investing in high-quality, professionally managed living spaces that meet the changing needs of institutional investors.”

Developed Market Strategy

The Korean deal comes after M&G in March acquired a purpose-built student accommodation asset in Melbourne for $61.8 million, marking the fund manager’s first investment in Australia’s thriving student housing market.

That Aussie venture followed a pair of Japanese living sector buys, with M&G having purchased a multi-family residential tower in Tokyo’s Shinjuku area from LaSalle in January 2024 for JPY 30 billion ($204 million).

At the time that it formally announced its living sector fundraising in October, M&G revealed a $68 million acquisition of a set of Osaka apartments under its living sector strategy.

“Together with our residential investments in Japan and purpose-built student accommodation in Australia, we continue to diversify across countries, sectors and housing types,” M&G’s Askham said in Tuesday’s announcement. 

Having been active in Asia Pacific’s residential sector for more than a decade, M&G Real Estate now manages around $7.4 billion in living sector assets globally, spanning multi-family, student housing and senior living, the company said.