Officetels lose little bit of luster as investments

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Officetels lose little bit of luster as investments

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The average price of an officetel, a space that can be used either as an office or an apartment, was 186.6 million won ($163,000) as of the end of March, and the annual return on investment (ROI) was 5.78 percent, a drop of 0.23 percentage points year on year, according to a study by KB Kookmin Bank.

According to the study, released earlier this week, of 1,283 officetel buildings and 300,581 units, Seoul was the most expensive, with units averaging 221.4 million won. But the ROI for Seoul units was lower than the national average of 5.37 percent and was 0.21 percentage points lower than the 5.58 percent recorded at the end of March 2015.

Units in Geumcheon District, southwestern Seoul, enjoyed the highest ROI in Seoul at 6.44 percent, followed by Dongdaemun District, northeastern Seoul, with 6.23 percent. Gangseo District in southwestern Seoul enjoyed an ROI of 6.19 percent.

All neighborhoods south of the river had ROIs under 6 percent, with Gangnam District at 4.95 percent and Seocho District at 5.25 percent.

Gyeonggi’s average ROI was 5.83 percent, down from 6.11 percent a year ago. Incheon had the highest ROI in the greater Seoul area, with 6.82 percent, but this was still lower than its 7.1 percent last year.

Around the nation, South Chungcheong raked in the biggest profit, with 7.52 percent, narrowly beating North Chungcheong’s 7.51 percent. Gwangju’s ROI was 7.41 percent, while Daejeon’s ROI was 7.19 percent.

“Although there is controversy surrounding the oversupply of officetels, the interest in officetel investments, especially in regions with strong demand, continues to grow as a profit-making investment,” a KB Kookmin Bank official said.


BY LEE HO-JEONG [lee.hojeong@joongang.co.kr]




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