Gangnam Dogok-dong 'Maebong Station' 3-Minute Walk, 3.6 Billion KRW New Construction Site Investment Case Analysis: Attractive 4.6% Yield!
Dogok-dong in Gangnam, a highly regarded residential area with a vibrant commercial district centered around Maebong Station (Subway Line 3). Recently, an investment case involving a prime new construction site in this area has been revealed, drawing significant interest from real estate investors. Despite a price approaching 50 million KRW per pyeong, it is evaluated as an attractive investment due to its excellent location and abundant development potential, promising high returns. Like a goose that lays golden eggs, let's take a closer look at the opportunities that the Dogok-dong new construction site offers investors.
3-Minute Walk from Maebong Station, 3.6 Billion KRW Transaction Completed for Dogok-dong 417-8
Located in Dogok-dong, Gangnam-gu, at 417-8, a 72.54 pyeong new construction site just 230m from Exit 4 of Maebong Station (Subway Line 3), was traded for 3.6 billion KRW in November 2019. The price per pyeong is approximately 49.63 million KRW, considered competitive given its Gangnam location. Notably, it is adjacent to an 8m wide road and directly in front of Dogok Mokryeon Park, which is expected to secure a pleasant environment and excellent views after construction, further enhancing its investment value. Like an oasis in the city center, the proximity to the park will inject vitality into the otherwise bustling urban life.
Abundant Catchment Area and Developed Food Alley, Optimal Location for Company Building and Rental Income
The area around Dogok-dong 417-8 boasts a rich surrounding residential population, and the food alley (meokja golmok) formed around Maebong Station is a vibrant area with constant foot traffic. This raises expectations for high demand for company buildings and office rentals in the new construction. Furthermore, the presence of Yangjaecheon Cafe Street and the high-end residential complex Tower Palace nearby also contributes positively to the investment by securing a strong consumer base. Like a well-planned city, convenient living infrastructure and abundant demand provide a solid foundation for stable investment.
Adjacent to an 8m Road, Park Views as Well…Optimal Conditions for New Construction
The new construction site benefits from excellent accessibility via the 8m wide road directly in front, and the upper floors of a new building are expected to offer green views of Dogok Mokryeon Park, providing a pleasant working environment. With a wide road frontage, the visibility of a building constructed here will also be high, creating favorable conditions for attracting tenants in various industries. Like framing a picturesque landscape, the park view will further elevate the value of the building.
Potential for B1-5F Construction, Expected Rental Yield of Over 4.6%
Considering the construction cost of approximately 4.5 million KRW per pyeong for new construction on this site, it is estimated that a building with 1 basement level and 5 above-ground floors can be built. The total estimated acquisition cost, including construction, is around 4.473 billion KRW, with an expected annual rental yield of approximately 4.67%. This is an attractive rental yield in an era of low interest rates, making it a good option for investors seeking stable rental income. Like a well-designed investment portfolio, steady returns will provide investors with a sense of security.
Suitable for a Company Building Capable of Securing Rental Income, Potential for Maximizing Returns Through Leverage
After construction, using part of the building as a company headquarters and leasing out the remaining space can create the effect of purchasing a standalone company building by offsetting the mortgage with rental income. This is a smart strategy to maximize investment returns by leveraging the property. Like catching two birds with one stone, you can achieve both securing a company building and generating rental income simultaneously.
Competitive Pricing Compared to Nearby Sales, Potential for Capital Gains Due to Nearby Development
The site was a competitively priced urgent sale compared to nearby transaction cases, and even when including construction costs, it remains competitively priced compared to other sales in the vicinity. Moreover, the potential for capital gains due to nearby development projects further enhances its long-term investment value. Like discovering a hidden gem, you have found an investment with high potential at a reasonable price.
