Girls' Generation's Yuri sees a massive 10 Billion KRW (~7.4 million USD) increase in her building value after just four years

AKP STAFF

n.news.naver.com

The value of Girls' Generation member Yuri's building purchased in 2020 has increased by approximately 10 billion KRW (~7.4 million USD) in four years.

According to Building Road Real Estate Brokerage, on August 2, Yuri purchased a building in Nonhyeon-dong, Gangnam, Seoul, in July 2020 for 12.8 billion KRW (~9.42 million USD).

The building, constructed in 2003, has a basement and five above-ground floors, with a land area of 479.3㎡ and a total floor area of 1,301.2㎡. Its visibility and accessibility are enhanced by its location at a three-way corner. It's located on a back street of Seolleung-ro in Nonhyeon-dong, near Hakdong Elementary School, and is a three-minute walk from Seonjeongneung Station, a transfer station for lines 7 and 9, and a ten-minute walk from Gangnam-gu Office Station.

Yuri bought the building under her name, with an estimated loan of 10.5 billion KRW (~7.73 million USD) out of a secured bond limit of 12.6 billion KRW (~9.3 million USD). Subtracting the loan from the purchase price, along with ancillary costs of 700 million KRW (~515,184 USD), she effectively invested about 3 billion KRW (~2.21 million USD) in cash, resulting in an 82% loan-to-value ratio.

Kim Kyung Hyun, a representative from Building Road Real Estate Brokerage, said, "It took about two months from the contract date to the final payment, according to the mortgage registration." He added that this area is favored by quality tenants looking for comprehensive rental office buildings, making it a sound investment.

The current tenant is a game company leasing the entire building. At the time of purchase in 2020, the annual rental yield was 3.71%, indicating a well-acquired property with high returns.

A similar building sold 130 meters away in June 2023 for 15.75 billion KRW (11.6 million USD), implying a potential market price of 23 billion KRW (16.9 million USD) for Yuri's building, yielding a profit of 10 billion KRW (~7.4 million USD). However, due to differences in construction years, some adjustments are necessary. The building sold in 2023 was recently built, while Yuri's building was constructed in 2003 and underwent major renovations in 2017.

Kim added, "If we calculate the new building's price minus the construction cost (10 million KRW per 3.3㎡), the land price per 3.3㎡ is about 13.109 million KRW (~9,648 USD). Applying this to Yuri's building results in a current value of 19.1 billion KRW (14 million USD), indicating a potential profit of over 6.3 billion KRW (4.7 million USD) in four years."

The current building coverage ratio is 50.85%, lower than the legal limit of 60%, leaving room for potential expansion through an addition or reconstruction.

Kim mentioned that "increasing the floor area ratio by adding 13.05㎡ per floor across five floors could yield an additional monthly income of 6.28 million KRW, increasing the annual rental yield from 3.71% to 4.32%."

Furthermore, the building's potential for higher returns makes it an attractive investment. Building Road Real Estate Brokerage's team leader Jeon Ye Seong runs the YouTube channel 'Small Building Yongsik Yesung' for real estate information.