In the fourth quarter of last year, a report revealed that commercial real estate transactions totaling more than 500 million won took place.
According to the '2024 4th Quarter Domestic Commercial Real Estate Market Report' released by global comprehensive real estate service corporations CBRE Korea on the 20th, there were commercial real estate transactions totaling 5.2685 trillion won in the fourth quarter of 2024.
Among these, the transaction volume for offices was approximately 4.352 trillion won, accounting for about 83% of the total transaction volume and driving the market. This quarter, particularly notable transactions included the acquisition of Di Tower Dongmoon by NH Bank’s Real Estate Investment Trust Management in the city center, the investment in Jeongdong Building by U.S. investor Nubian, and the acquisition of key assets such as NH Bank Capital Building in the Yeouido area.
Additionally, various types of transactions in the office investment market were led by KOREIT's acquisition of office and data center complex Corea Tower in the Gangnam area through its preemptive right, as well as Center Point Gangnam acquired by F&F through a pre-purchase deal with Master Investment Management, and Case Square Magok (CP3-2) by Koramco REITs Management and Trust.
In the fourth quarter, the office market showed a stable condition, with a slight decline in the vacancy rate. The vacancy rate of grade A office buildings in Seoul decreased by approximately 0.3 percentage points compared to the previous quarter, standing at 2.4%, marking a slight downturn after a gradual increase since the first quarter.
The transaction volume in the logistics market was around 374.7 billion won, with grade A core asset transactions accounting for 71%, showing a difference from the previous quarter, which had a predominance of pre-purchase and non-performing loan transactions. In the fourth quarter, a total of 10 new grade A assets were supplied, covering 1,165,274 square meters, with approximately 54% concentrated in the western region, including Incheon Dohwa Logistics Center and Logistics Point Gimpo SMART Logistics Center.
The vacancy rate in the grade A logistics market in the metropolitan area increased by 2.3 percentage points compared to the first half, reaching about 23%, while ambient and cold storage recorded 17% and 41%, respectively.
Retail transactions were approximately 421.7 billion won, predominantly involving transactions between small and medium-sized asset corporations and individuals. Despite expectations for domestic growth due to two interest rate cuts within the fourth quarter, negative factors such as a sudden increase in exchange rates due to the emergency martial law in December, a decrease in foreign tourist arrivals, and weakened consumer sentiment contributed to a 1.3% decline in sales compared to the same period last year.
The hotel market saw major transactions like the Dears Myeongdong Hotel and L7 Gangnam, with a transaction volume of approximately 120 billion won, and the recovery in foreign tourist arrivals alongside ongoing hotel transactions indicates that future transaction volumes are expected to expand.
Choi Soo-hye CBRE Korea Research Director noted, 'The fourth-quarter commercial real estate market coexisted with risks such as domestic and foreign political issues and changes, economic downturn forecasts, and sluggish domestic demand, despite positive factors like two interest rate cuts. Nevertheless, the successful conclusion of numerous deals, including the pre-purchase of large office assets, contributed to a robust investment volume.'
He further projected that 'this year, while the commercial real estate market continues its solid trend, imbalances in expected prices between sellers and buyers and volatility depending on asset characteristics will be observed.'