[Edaily Marketin KIM SUNG-SOO Reporter] The maturity date for the 480 billion won bridge loan for the development project on the site of the E-Mart Gayang branch in Gangseo-gu, Seoul, is fast approaching. While refinancing is currently underway ahead of the loan’s maturity, specific terms—including the new maturity date—have not yet been finalized.

The project schedule, which originally aimed for a conversion to project financing (PF) and the start of construction this year, has effectively been put under review. As the nationwide market for knowledge-industry centers remains in a slump, the future timeline for the project is expected to be highly uncertain.

480 billion won bridge loan

matures

on the 10th… Refinancing negotiations underway

According to the financial investment industry on the 7th, the knowledge industry center development project underway on the site of the E-Mart Gayang branch will see a 480 billion won

bridge loan

mature

on the 10th. Discussions

regarding refinancing are currently underway with the lending syndicate.

It is reported that discussions are likely to focus on maintaining the loan amount at the existing level of 480 billion won. However, as negotiations are still ongoing, specific terms—such as the new maturity date and interest rate—have not yet been finalized.

This project involves the development of the site of the E-Mart Gayang branch, located at 449-19 Gayang-dong, Gangseo-gu, Seoul. The plan is to demolish the existing E-Mart store and construct a 21-story knowledge industry center, along with retail facilities and neighborhood amenities.

Initially, the project was planned as a mixed-use development that included officetels. However, due to high interest rates and a downturn in the real estate market, demand for officetels has declined, leading to a revision of the project plan to focus on a knowledge-based industrial center.

Case Square Grand Gangseo PFV is serving as the project developer, with Hyundai Engineering & Construction acting as the general contractor. Koramco Asset Management is responsible for asset management.

Looking at the combined ownership stakes—including common and preferred shares—of K-Square Grand Gangseo PFV’s major shareholders, Eastern Investment & Development holds the largest stake at 49%. This is followed by △Hyundai Engineering & Construction at 29.9%, △Koramco Asset Management at 15.1%, and △Shinhan Asset Trust at 6%.

Bridge Loan Refinancing: The ‘First Hurdle’ Toward Normalizing the Project

The initial

project

schedule was relatively concrete. The goal was to complete the transition to the main PF by the first quarter of this year and begin construction in May. Completion was expected in the first half of 2029 or later.

However, as detailed coordination became necessary during the project’s implementation, the schedule was completely revised. The transition to the main PF has been delayed compared to the original plan, and it is currently difficult to predict when construction will begin.

Consequently, this bridge loan refinancing is expected to serve as the first hurdle toward getting the project back on track. The key question is whether the project can secure enough time through the maturity extension to proceed with the transition to the main project financing (PF). In particular, as the E-Mart Gayang branch site is one of the largest development sites in western Seoul, industry attention is focused on whether the project will move forward.

However, as the knowledge industry center market is also currently facing challenges such as oversupply and shrinking demand, the extent to which the project can secure actual profitability is considered a major variable.

The nationwide knowledge industry center market has entered a full-scale restructuring phase amid a disappearance of investment demand and the spread of financial risks. According to R Partners, the operator of Knowledge Industry Center 114, the number of transactions for knowledge industry centers nationwide in the first quarter of this year was 1,043, a 5% decrease from the previous quarter, while the total transaction value was 428.6 billion won, a 21% decrease from the previous quarter.

The national average transaction price was 13.5 million won, down 5% from the previous quarter. The slump in the pre-sale market is also severe. New pre-sale supply in the first quarter of this year recorded “zero (0)” for the second consecutive quarter. Analysts suggest that the limitations of the traditional pre-sale model are becoming apparent due to a combination of financial institutions tightening their screening for interim and final payment loans and a trend among actual demand-driven companies toward leasing.

Market instability was particularly evident in the auction market. In the first quarter of this year, the number of auctions for knowledge-industry centers in the Seoul Metropolitan Area reached 1,233, an increase of approximately 300% compared to the same period last year.