GIC hopes to leverage Korea’s love for shopping in its latest mall deal
Korea’s unique style and fashion sense may not be everyone’s cup of tea, but Singapore’s sovereign wealth fund appears to like what it sees in the country’s retail scene. GIC invested $136 million to acquire an interest in G-Square City Retail Complex located in the suburbs of Seoul.
The 28-storey complex also has an office tower and boasts 238,248 square metres of space. Located in Anyang, the mall is roughly a 40-minute train ride from the Seoul city center, and is connected to a metro station. The complex is operated by local Korean conglomerate Lotte and contains a Lotte Department Store, Lotte Mart and Lotte Cinema.
South Korean conglomerate GS Group put the entire mall up for sale in May of this year hoping to get $615 million for it, but has instead completed the deal with GIC for an undisclosed stake in the complex.
“G-Square, being a dominant and well-located retail mall, is in line with our strategy of acquiring stable, income-generating assets,” Lee Kok Sun, Chief Investment Officer, GIC Real Estate stated. “As a long-term investor, we remain confident in the continued growth of the Korean economy and its retail sector.”
Second Korean Investment For GIC in 2016
GIC’s new retail complex in South Korea is operated by Lotte and also includes office space
The deal is the second notable move GIC has made in South Korea during the past six months. In July, the Singapore-based institution invested $130 million in a fund managed by ADF Asset Management, which acquired the Hyundai Logistics Distribution in Incheon.
During that time it was also announced that the Seoul-based logistics specialist would team with GIC to develop the Dongtan logistics complex in Gyeonggi Province, the same province as G-Square City Retail Complex.
The project, which is expected to be completed over the next three years, will cost KRW800 billion ($682 million) and have 620,000 square metres of space when finished.
Spreading The Sovereign Wealth
With more than $100 billion in assets under management, GIC continues to mix and match where and what they buy. This year has seen the firm gobble up everything from sheds in the Czech Republic to trailer parks in the US and all types of real estate in between.
Starting with the most recent deal, the firm acquired P3 Logistic Parks for €2.4 billion ($2.6 billion) from TPG Real Estate and Ivanhoé Cambridge. The Singapore sovereign wealth fund picked up 163 warehouses in 62 locations as part of the deal.
Staying in the logistics sector, GIC also teamed up with warehouse provider PT Mega Manunggal Property to invest S$1 billion ($720 million) in the Indonesian logistics sector.
There were also some unique accommodation pickups with GIC said to have offered $2 billion for a US trailer park operator and buying student housing portfolios in both the UK and Germany this year.
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