LaSalle Investment Management has built a four-story logistics warehouse near Seoul, its first development of a storage facility in South Korea, and said that it is looking for more land acquisitions in strategic locations in the country.
LaSalle Asia Opportunity Fund IV, a series of LaSalle’s funds employing an opportunistic strategy, financed the construction of the 43,405-square-meter warehouse in Icheon City, Gyeonggi Province, a one-hour drive southeast of Seoul. It bought the land in February 2016.
“Despite South Korea’s e-commerce and consumer penetration fundamentals linked to a connected and dense population, there is an existing lack of modern warehouses for both tenants seeking quality space and institutional investors seeking core properties,” Steve Hyung Kim, head of acquisitions and representative director for LaSalle Investment’s Korean operations, said in a press release on Dec. 5.
“We plan to selectively target land acquisition opportunities in strategic locations in South Korea going-forward,” Kim added.
The real estate investment firm said the facility has secured leases with a number of unidentified global companies. It did not disclose the construction cost.
The city where the facility is located has strong transport links to major cities across South Korea, with access to major North-to-South and East-to-West national and local highways.
Many of logistics centers that major institutional investors had bought are situated in the city.
South Korea’s logistics facilities market is expanding with the joining of global institutional investors, such as Singapore’s sovereign wealth fund GIC, Goldman Sachs and Deutsche Asset Management.
They had acquired existing facilities near Seoul.
Earlier this year, however, Goldman Sachs examined a couple of sites in Gyeonggi Province to build a logistics center of around 100 billion won, the Seoul Economic Daily reported in April. No progress has been reported since then.
LaSalle, part of Jones Lang Lasalle, a real estate consultancy, had $58 billion AUM at end-September. It manages $2.6 billion of logistics real estate assets across the Asia-Pacific region.
LaSalle Asia Opportunity Fund IV is focused on Australia, China, Japan and South Korea.
By Daehun Kim
<Edited by Yeonhee Kim>