CJ Group's logistics subsidiary CJ Logistics and LX Group's comprehensive logistics company LX Pantos have listed a large logistics center located in Busan for sale. It is considered a prime logistics center as it is accessible from the entire Busan, Ulsan, and Gyeongsangnam-do (Busan-Ulsan-Gyeongnam) region and is located near Busan New Port and Gimhae International Airport.
On the 10th, according to the investment banking (IB) industry, Jisoftwear Bank Korea has selected Jones Lang LaSalle (JLL), a global commercial real estate services firm, as the sales advisor for the L Square logistics center located in Mieum, Busan. The selling side is confirmed to have distributed teaser letters to domestic and international financial investors (FIs) and strategic investors (SIs), including real estate specialized asset management companies.
The L Square Mieum logistics center, completed in 2022, is located in the core area of the Busan-Jinhae Free Economic Zone (BJFXZ), which is a key location in the western region of Busan. It is a multi-purpose logistics center with a total floor area of 77,912 square meters (23,569 pyeong) over five floors. It is a last-mile center capable of multi-round deliveries, adjacent to densely populated areas in the Yeongnam region, including Busan and Ulsan.
Another strength of the L Square Mieum logistics center is its proximity to Busan New Port, the largest port in Korea and the second-largest transshipment port in the world (North Port, South Port, Gamcheon Port, New Port, Dadaepo Port). It can encompass the export-import logistics distribution network. Additionally, being able to access Gimhae International Airport by vehicle within 30 minutes is also considered an advantage.
Industry insiders explain that because CJ Logistics and LX Pantos are 100% tenants, stable cash flow can also be secured. The remaining lease period (Weighted Average Lease Expiry - WALE) of CJ Logistics is seven years. LX Pantos, which occupies 51% of the total area, has a responsible lease term of about one year, with about two years left until the lease expires. An industry insider noted that "the rent for LX Pantos is at a relatively low level compared to the market, and an increase in rent is expected when renewing the lease or attracting new tenants."
As the Busan-Ulsan-Gyeongnam region has recently emerged as a logistics hub following the metropolitan area, it is anticipated that the L Square Mieum logistics center will also attract the interest of buyers. A commercial real estate advisor stated, "The Busan-Ulsan-Gyeongnam region is an area where the food and beverage industry and e-commerce companies are actively entering, based on population density and geographical advantages." Coupang is currently operating eight fulfillment centers in the Busan-Ulsan-Gyeongnam area.
Major transactions include the Logistics Spot Busan logistics center (185 billion won) and LG Electronics' integrated logistics center (109 billion won). The selling side analyzed in the teaser letter that "there are supply volumes waiting around the logistics center in the future, but most of them are planned for self-use, so the risk of new supply is low."