Smart Farm Center Seeks New Alternatives in Real Estate Market by Utilizing Idle Assets for Smart Farms

From Real Estate Asset Assessment to Utilization
A Stable Income Model for Building and Land Owners

Logistics Center and Plant Factory Images

In February 2025, Smart Farm Center Co., Ltd. signed a memorandum of understanding (MOU) with Intrus Investment Management Co., Ltd., which operates real estate funds and REITs, to expand its smart farm business. As part of this initiative, a company representative stated that they are working to convert vacant spaces within the logistics center owned by company 'S' in Yongin, Gyeonggi Province into smart farms and securitize them as REIT assets. In addition, they are actively considering introducing smart farms into knowledge industry centers in Seoul and Gyeonggi Province.

The "Urban Eco Farm Solution" presented by the Smart Farm Center consortium is a business that builds vertical farms and provides operational support services by utilizing vacant or idle spaces in buildings such as knowledge industry centers and logistics centers. The solution offers a comprehensive package to landowners, building owners, construction companies, or businesses with vacant spaces, including: ▲business model design ▲vertical farm construction ▲management and operation support (leasing and consignment operation) ▲maintenance ▲farm ERP provision ▲distribution channel development ▲franchising ▲investment, among others. This enables customers with little knowledge of vertical farming to easily enter and operate the business.

A vertical farm is a plant production system that produces crops by controlling environmental factors necessary for crop growth?such as light, temperature, carbon dioxide, humidity, airflow, and mineral nutrients?according to specific objectives. Through multi-level cultivation and automation of production processes, crops are grown across multiple floors within a building, making maximum use of limited space. Unlike open-field agriculture that uses natural sunlight and conventional smart farms, vertical farms can grow crops without being affected by external environmental conditions, and their value has already been demonstrated.

Until recently, industrial complexes were designated for manufacturing and knowledge industries, so vertical farms, which are classified as agriculture, were not permitted to move in. However, in line with the government's ongoing support for smart agriculture, the Ministry of Trade, Industry and Energy and the Ministry of Land, Infrastructure and Transport revised the Enforcement Decree of the Industrial Cluster Development and Factory Establishment Act in November 2024, allowing building-type vertical farms to be located in industrial complexes. As a result, vertical farms have become the first agricultural production facilities eligible to move into industrial complexes.

This project is significant from an economic perspective because it transforms idle urban spaces into income-generating assets, providing building owners with a stable income model. In particular, by converting underutilized spaces in knowledge industry centers or logistics centers?spaces with fixed costs but low utilization?into vertical farms, the utilization and value of real estate assets increase, and stable profits can be secured relative to vertical farm operating costs.

In addition, vertical farm operations enable stable, year-round production of agricultural products, contributing to the stability of local food supply and enhancing urban food self-sufficiency. The crops produced can be distributed through various channels such as F&B stores, distributors, and processing centers, enabling the establishment of a sustainable distribution structure.

From a social perspective, this approach enables the supply of eco-friendly food close to urban residents while also creating new urban agriculture jobs. In particular, it is expected to help build an urban agricultural job ecosystem that can include a variety of groups such as seniors, young people, and women returning to the workforce, thereby laying the groundwork for mutual growth with the local community. Furthermore, hands-on vertical farms and educational farm models could serve as platforms for agricultural and dietary education.

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