17-11-2023, 06:11 AM
UPDATED NOV 15, 2023, 5:50 PM SGT
HONG KONG – From London to New York, nobody wants to be a commercial landlord these days. But in the South Korean capital, owners of office towers are living the boom life.
Seoul’s office market is every landlord’s dream: More than 98 per cent of grade A offices are occupied, with rents surging 15 per cent from 2022.
......
Such a scenario is unimaginable for landlords in the United States, where offices are seeing tenants cut space or move out as employees become reluctant to badge in.
Property owners are struggling to stay afloat with higher interest rates squeezing margins even more. Office prices in the US are due for a crash, and the commercial real estate market faces at least nine more months of declines
......
in an ironic twist, South Korean investors have been among the most badly burnt by the global market’s collapse. Pension funds, insurance companies and asset managers ploughed billions into overseas properties just before the Covid-19 pandemic drove down their value, raising the risk of a credit crunch.
In South Korea, the market is thriving because of a unique mix of supply and demand factors, cultural preferences and economic resilience.
......
Redevelopment restrictions imposed by the government a few years ago and disruptions to development plans by the pandemic have contributed to the lack of supply
......
Meanwhile, the demand for offices is steady, thanks to the robust domestic economy.
......
It is a cultural thing, said one of the analysts. The work-from-home trend that has been emptying office floors in many Western economies does not apply to Seoul, or to most of Asia.
https://www.straitstimes.com/business/wo...-elsewhere
HONG KONG – From London to New York, nobody wants to be a commercial landlord these days. But in the South Korean capital, owners of office towers are living the boom life.
Seoul’s office market is every landlord’s dream: More than 98 per cent of grade A offices are occupied, with rents surging 15 per cent from 2022.
......
Such a scenario is unimaginable for landlords in the United States, where offices are seeing tenants cut space or move out as employees become reluctant to badge in.
Property owners are struggling to stay afloat with higher interest rates squeezing margins even more. Office prices in the US are due for a crash, and the commercial real estate market faces at least nine more months of declines
......
in an ironic twist, South Korean investors have been among the most badly burnt by the global market’s collapse. Pension funds, insurance companies and asset managers ploughed billions into overseas properties just before the Covid-19 pandemic drove down their value, raising the risk of a credit crunch.
In South Korea, the market is thriving because of a unique mix of supply and demand factors, cultural preferences and economic resilience.
......
Redevelopment restrictions imposed by the government a few years ago and disruptions to development plans by the pandemic have contributed to the lack of supply
......
Meanwhile, the demand for offices is steady, thanks to the robust domestic economy.
......
It is a cultural thing, said one of the analysts. The work-from-home trend that has been emptying office floors in many Western economies does not apply to Seoul, or to most of Asia.
https://www.straitstimes.com/business/wo...-elsewhere