Feeling the pressure: What’s driving South Korean property investment in Europe?
There has been a spate of major purchases of commercial real estate assets in Europe by South Korean investors in recent times.
The scale of these deals has been staggering. South Korea’s public pension fund, the National Pensions Service (NPS), purchased Goldman Sachs’ new London headquarters for £1.165 billion (€135 billion) in 2018, while France’s fourth tallest office building, the Majunga tower, located in Paris’s La Défense, was acquired by Mirae Asset Daewoo and Amundi Real Estate for €850 million.
Driving these investments is a growing pressure felt by South Korea’s pension and investment funds to boost yields and diversify their investment portfolios, both geographically and by asset type, with an increasing emphasis on alternative assets such as real estate.
This was neatly summarised by Kim Sung-Joo, chair of the NPS, in an interview with The Financial Times in August, during which he said that the NPS was rapidly increasing i