Rodamco Asia N.V. (Ã¢â¬ËRAÃ¢â¬â¢) today announced that it has finalised an agreement with South KoreaÃ¢â¬â¢s largest insurance company, Samsung Life Insurance (Ã¢â¬ËSLIÃ¢â¬â¢) under which the latter has taken a minority stake in Rodamco Center (Ã¢â¬ËRCÃ¢â¬â¢) while RA will asset manage the property in return for fee income.
This co-investment agreement with Samsung Life, which has assets of US$ 49 billion and 46% share of the South Korean insurance market, marks the beginning of a relationship with SLI that has the potential to expand further in South Korea and elsewhere in Asia.
As a result of the agreement, Samsung Life has purchased from Rodamco Asia 14.99% of the equity interest of the company that owns Rodamco Center, for a sum of KRW 3.6 billion (Ã¢âÂ¬ 2.6 million). Following the transaction, RAÃ¢â¬â¢s stake in RC has been reduced from 100% to 85.01%.
Rodamco Asia as the asset manager of Rodamco Center, will be paid an annual asset management fee based on the market value of RC, and will also be entitled to an incentive fee based on total returns achieved.
Rodamco Center is the new name for Eunsuk Building, which was 100% acquired by Rodamco Asia in mid-May 2003. It is a twin-tower office complex in the Central Business District of Seoul with a gross floor area of 52,471 square metres. It is currently 97.2% occupied, with the largest tenants being Samsung Card, a top credit card company in South Korea, and Kyesung Paper, a major paper manufacturing company.
Ton de Boer, CEO of Rodamco Asia said, Ã¢â¬ÅThis is an excellent start to what we want to do more of in the future Ã¢â¬" which is to allow strategic partners to take minority stakes in our properties in return for fee income from our investment and asset management. The fact that Samsung Life, a dominant player in the South Korean market, is the first to co-invest with us in their home market is a tremendous endorsement of our investment and asset management capabilities in Asia. Given our track record, in-depth local market knowledge, extensive local contacts and assets of high quality, I firmly believe we are uniquely placed to attract more like-minded investors from Asia and Europe to co-invest with us in future.Ã¢â¬Â
Source: Rodamco Asia