Jungang Advanced Materials Acquires Yongsan Real Estate... "Successful Loan Recovery, Positive Move Away from Ventilation"
Jungang Advanced Materials announced on the 27th that it acquired income-generating real estate worth approximately 24.6 billion KRW located in Yongsan-gu, Seoul, from Kyleum D&D, a 100% subsidiary of Sangji Kyleum.
With the additional funds secured through this transaction, Kyleum D&D will repay its debt to its parent company Sangji Kyleum, while Jungang Advanced Materials, which recently turned profitable in the third quarter and escaped capital erosion, is expected to recover part of the loan extended to Sangji Kyleum.
A company representative stated, “This acquisition was carried out through mutual agreement between the two companies as part of loan recovery. In particular, the property is long-term leased as office space to an affiliate of a major domestic IT conglomerate,” adding, “It is a high-quality income-generating real estate producing stable annual income of over 800 million KRW, and significant capital gains are expected upon future sale.”
The company explained that this loan recovery will improve financial soundness and enhance cash flow through rental income, which could positively impact the company’s removal from the watchlist.
According to the real estate industry, Korea Railroad Corporation (KORAIL) plans to finalize the Yongsan International Business District development plan within the year and begin full-scale construction. The Yongsan International Business District development project aims to transform the Yongsan Maintenance Depot site into a complex district featuring an international business complex, residential areas, and parks and green spaces.
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The income-generating real estate acquired by Jungang Advanced Materials is located between the maintenance depot site and Yongsan Park, close to the Han River, and is highly valued as an office with rare park view, city view, and river view. The external appraisal value of the property is approximately 24.6 billion KRW, and its actual value is expected to exceed this in the future.
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