IPD has released its 2007 results for the performance of the South Korean commercial property market. IPD Korean Property Index, which is in its second year of publication, shows that the total return for the 12 months to December 2007 was 26.9%, which is considerably higher than the 15.5% total return at the end of 2006. The Korean return is also the second highest 2007 result amongst the countries on which IPD has so far reported.
Office properties in Seoul, which account for 67% of the Korean databank, performed slightly better than the All Property average, with a return of 29.2%. IPD is not yet able to show returns for any of the other sectors because the sample sizes are not sufficiently large and/or the ownerships of the properties not sufficiently diverse to comply with IPD's confidentiality commitments to individual data subscribers. The Korean index is therefore published as a consultative release.
Overall, the total return on Korean property combined an income return of 6.6% with a capital return of 19.2%. In the case of Seoul offices, the figures were 7.0% and 20.8% respectively.
Dr Kevin Swaddle, Director for IPD's services in Asia said, "The publication of the Korean property index is an important symbol that the Korean property market is embracing greater transparency, and this should bring benefits to the market in terms of increased investment from international institutions. This consultative release is not the end of road, but it is a big first step. We look forward to publishing a full index next year."
Click here to read the report.