Zara Buys Luxurious Building on Myung Dong St - Seoul
Myung Dong is a mecca for shoppers surrounded by luxury department stores, artists’ boutique shops, trendy restaurants, etc. where young Koreans meet up and foreigners from around the world visit to feel the dynamics of the capital city, Seoul. Due to its proximity to major subway lines and convenience to access the country’s trendsetting entertainment facilities, real estate prices in Myung Dong are kept high at all times.
It was astounding news to the Korean real estate market that the founder of global fashion brand Zara, Amancio Ortega, purchased a 22-story building called Myung Dong M Plaza (27,000 square meters and 22 stories high) at 430 billion won. According to a person who is familiar with the deal, several local and foreign investment banks competed against each other aggressively, and in the end Mr. Ortega was chosen due to his solid financing status, although his bid was not the highest. Considering that this is Mr. Ortega’s first deal in Asia, local and foreign real estate experts are paying attention to his next move. M Plaza, built in 1971, is located in the center of the commercial zone and was renovated in 2008. At present, popular fast fashion brands Zara, Forever 21 flagship stores, etc., run from basement Level 1 to ground floor 5, and a Japanese hotel, the Solaria Nishitetsu, operates from floor 7 to floor 22.
The experts predict that M Plaza will produce not only stable income from renters, but also extra profits from stores’ operations in the future. Mr. Ortega said to the press after the deal went through that he saw the potential value growth of commercial buildings in Korea. Amancio Ortega is a self-made billionaire from Spain and Forbes Magazine ranked him as the No. 2 richest business man in the world.