Lotte Tour Development "Negotiating 700 Billion Won Refinancing with Major Domestic Financial Institutions"

by Kim Yuri

Published 12 Apr.2023 11:14(KST)

"Goal to Complete Refinancing in October"

Lotte Tour Development announced on the 12th that it has been conducting detailed discussions since early this month with 4 to 5 major domestic first-tier financial institutions, including large banks, regarding the refinancing of secured loan borrowings amounting to 700 billion KRW, which mature at the end of November.

Lotte Tour Development expects the appraised value of the Jeju Dream Tower complex resort to rise to around 1.7 to 1.8 trillion KRW through land asset revaluation (from 104.7 billion KRW to 568 billion KRW) conducted last June, emphasizing that refinancing will be successfully completed under favorable conditions within a loan-to-value (LTV) ratio of 50% or less.

Jeju Dream Tower Complex Resort View <span class="caption">Photo by Lotte Tour Development</span>.

Jeju Dream Tower Complex Resort View Photo by Lotte Tour Development.

Lee Ki-woon, CEO of CCGI, which is overseeing the refinancing, explained, "This refinancing situation is completely different from the initial borrowing in 2020, which was mainly conducted through secondary financial institutions when the hotel had not yet opened and the core business of casino relocation permits was uncertain. Recently, with the resumption of numerous international direct flights including major Chinese cities, changes are beginning in the casino sector, and major financial institutions are showing interest in future cash-generating capabilities." CCGI is an investment bank and private equity firm under CIMB Group, Singapore's largest securities group. Over the past five years, it has managed the entire development financing process of the Jeju Dream Tower complex resort, totaling approximately 1.4 trillion KRW.

Meanwhile, regarding the reopening atmosphere, Lotte Tour Development stated, "Since the end of last month, with the resumption of direct flights between Jeju and Shanghai 35 times a week, the number of casino visitors last month reached about 13,000. The drop amount has also been breaking record highs daily."

Lee Ki-woon, CEO of CCGI, explained, "After delivering the refinancing schedule to the first-tier financial sector, including six major banks, earlier this month, negotiations have begun. We plan to select two large securities firms to act as a small-lender group by June and aim to complete the refinancing by October at the latest."