No Empty Offices in Yeouido
By Yoon Ja-young
Staff Reporter
Offices in Yeouido, often dubbed the Manhattan of Seoul, are becoming scarce as securities companies and asset management firms are being set up ahead of the implementation of the Capital Market Consolidation Act.
According to CB Richard Ellis, a commercial real estate services company, the availability of top class offices in Yeouido is close to zero.
This is due to the launch of a series of new securities and asset management companies this year. Despite the economic slowdown, financial businesses and other manufacturers are strengthening their financial arms ahead of the Capital Market Consolidation Act next year, which will demolish the walls between various financial businesses.
Over a score of such new entities have been set up so far this year ― eight securities companies including IBK Securities and KTB Investment and Securities, and 13 asset managers including Truston, Asset Plus, and BlackRock Asset Management.
Since most financial infra is set up in Yeouido, any financial business would prefer building their nest in there. Even the Financial Supervisory Service is located in Yeouido.
Among the 21 rookies, however, only nine, including IBK, succeeded in opening an office in Yeouido. Some of them signed for an office even before getting approval from the financial regulator, and IBK was burdened with the most expensive rent in Yeouido as the 63 Building was its only option. The rest of the businesses had to head to Gwanghwamun or southern Seoul.
Real estate analysts say that apartment speculation during the last few years has resulted in a lack of office buildings. Construction companies have focused on building apartments during the last few years amid soaring apartment prices. Supply of office buildings was relatively small.
Summer is generally a slow season for real estate transactions, but the new demand coupled with a lack of supply is making offices scarce in Yeouido. The demand isn't likely to dwindle since asset management firms operating in other parts of Seoul are looking for chances to move into Yeouido any time. Analysts estimate things will get better only after 2010, when new offices will be supplied en masse with the opening of Parc 1 and the Seoul International Finance Center.