[Funding] IREIT KOREA REIT issues secured bonds backed by 'NC Department Store Yatap Branch'

[Asia Economy Reporter Lim Jeong-su] E-Land Group's real estate investment company, E-Land REITs Corereb Corporate Restructuring Real Estate Investment Company (hereinafter E-Land REITs Corereb), is issuing secured bonds worth 115 billion KRW using NC Department Store Bundang Yatap Branch as collateral.

According to the investment banking (IB) industry on the 5th, E-Land REITs Corereb recently selected an underwriter and started the process of issuing secured bonds. They plan to provide the NC Department Store Yatap Branch as collateral by establishing a second-priority mortgage on the land and building.

The raised funds are reportedly intended to be used for repaying existing borrowings. Secured bonds generally have a credit rating one notch higher than regular corporate bonds, offering the advantage of reducing interest costs compared to general borrowings. They are used as a major financing method for REIT companies holding real estate assets.

E-Land REITs Corereb currently has the NC Department Store Yatap Branch pledged as collateral for borrowings to NH Life Insurance, Hyundai Marine & Fire Insurance, KB Insurance, Mirae Asset Life Insurance, and the National Credit Union Federation of Korea. E-Land Retail holds the first-priority leasehold right on bonds worth 9.4 billion KRW, while financial companies such as NH Life Insurance hold second-priority mortgages.

E-Land REITs Corereb was established in 2005 and listed on the Korea Exchange (KRX) in June 2018. During this process, it purchased 100% of the shares of KBY Star No.6 Trust Management Real Estate Investment Company (hereinafter ‘subsidiary REIT’) for 97.4 billion KRW. The largest shareholder is E-Land Retail Co., Ltd. with a 75% stake.

Currently, besides the NC Department Store Yatap Branch, it operates five investment properties located in the metropolitan area, including New Core Outlet Ilsan Branch and Pyeongchon Branch, 2001 Outlet Junggye Branch and Bundang Branch. E-Land Retail is the sole tenant. As of the end of last year, the real estate asset size was approximately 689.5 billion KRW based on book value.

This content was produced with the assistance of AI translation services.