Koramco to Generate Additional Revenue on Top of Full Occupancy Rental Income with Solar Power on Logistics Center Roofs

Koramco REITs & Trust announced on November 24 that it will implement a value-add strategy by introducing solar power generation facilities at the K-Logis Yangji Logistics Center, located in Cheoin-gu, Yongin, Gyeonggi Province. Construction is scheduled to begin early next year, and upon completion, the addition of power generation revenue to rental income is expected to significantly improve the REIT's profitability and asset value.

Since the beginning of this year, Koramco has been exploring ways to generate additional income from assets with stable cash flow. The Yangji Logistics Center is already at full occupancy. The company identified that utilizing the rooftop and roof space could increase the overall net operating income (NOI) of the REIT, leading to the consideration of solar power facilities.

In this context, Koramco has analyzed rooftop structures, solar irradiance, and the potential for electricity sales since last year. Ultimately, the company determined that introducing solar power would contribute to securing additional revenue and reducing maintenance costs for the logistics center.

This is part of a value-add strategy aimed at enhancing asset value beyond simple rental operations. A representative from Koramco's Value Investment Division explained, "The solar project is a strategic initiative to diversify our income base, and it is also expected to improve management efficiency and incorporate ESG elements."

Koramco is also considering expanding solar installations to other logistics centers it owns, starting with the Yangji Logistics Center. This is seen as a medium- to long-term strategy to secure stable cash flow across the logistics center sector as a whole.

Koramco has previously applied management strategies to enhance efficiency and profitability across various assets. The company integrated its management system by additionally incorporating the K-Logis Seoicheon 2 Logistics Center, located adjacent to the K-Logis Seoicheon 1 Logistics Center. It also sequentially acquired Majesta City Tower 1 and 2 in Seocho, Seoul, to strengthen rental competitiveness and management efficiency.

In the case of K-Square Hongdae, the installation of a digital billboard on the exterior wall generated approximately 200 million won in additional annual advertising revenue. This is considered an example of expanding the revenue model by increasing the utilization of existing assets.

The Yangji Logistics Center solar project is also an extension of this series of strategic management approaches. After completion, the structure will shift to include not only existing rental income but also power generation revenue and the effects of reduced management costs.

Lee Sangheon, Executive Director of Koramco REITs & Trust's Value Investment Division, stated, "We will continue to strengthen our management strategies to enhance the profitability and value of our assets. By expanding solar installations across logistics centers, including the Yangji Logistics Center, we aim to further reinforce the REIT's medium- to long-term dividend capacity."

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