Seoul commercial and office property deals total 1.8 trillion won... August deal count and value lose momentum

[Financial News] Seoul’s commercial and office property market appears to have taken a breather for a month in August, following the gradual recovery that continued through the first half of the year.
On the 14th, RSQUARE Analytics (RA), the analytics arm of commercial real estate services company RSQUARE, reported that an analysis of actual transaction data from the Ministry of Land, Infrastructure and Transport put the value of Seoul’s commercial and office property transactions in August at 1.8077 trillion won, across 139 deals. Those figures were down 31.2% and 24.5%, respectively, from the previous month. The average deal value also fell 8.9% month on month, to 13 billion won.
In the first half of this year, Seoul’s commercial and office property market showed positive momentum, with both the number of transactions (up 21.8%) and their total value (up 13.8%) increasing from the same period a year earlier. In particular, large deals helped lift transaction values to a solid mid-to-upper range of 2 trillion won in June (2.8115 trillion won) and July (2.6272 trillion won).
Overall transaction activity eased somewhat in August. Both the number of small and midsize building deals worth less than 100 billion won (down 24.7% from the previous month) and their total value (down 9.0%) were weak. The absence of mega-deals also contributed to the decline in total transaction value. There were five large deals worth at least 100 billion won, similar to the six recorded the previous month, but their combined value plunged 48.0% in a month to 776.9 billion won.
The largest deal in August was the 252 billion won sale of Corner 136 Building in Seogyo-dong, Mapo-gu. It was followed by E-Mart Cheonho Branch in Cheonho-dong, Gangdong-gu (166.6 billion won) and Shinhan Exspace in Chungmuro 2-ga, Jung-gu (128 billion won).
Despite the short-term adjustment in August, cumulative indicators remain on a solid footing. The value and number of transactions in August rose 77.0% and 6.9%, respectively, from the same month a year earlier. Accordingly, cumulative transaction value for January through August this year reached 15.7771 trillion won, with 1,356 deals, up 13.3% and 16.1%, respectively, from the same period last year.
However, concerns about future uncertainty are also being voiced both inside and outside the market. A representative of RSQUARE’s Research Center assessed, “Financing pressures stemming from the impact of base-rate hikes could dampen market transactions going forward, further increasing uncertainty in the commercial real estate market.”
[email protected] Jeon Min-kyung Reporter