Cushman & Wakefield Korea Launches Factory Sale and Leaseback Service in Industrial Complexes – Facilitating Immediate Funding for Companies with Cash Flow Challenges

Cushman & Wakefield Korea has expanded its Capital Markets platform with the introduction of a new Industrial Real Estate Sale and Leaseback (SLB) service. The new service facilitates the sale of companies’ industrial real estate assets while allowing them to lease these assets back, providing a solution for those experiencing temporary cash flow challenges or those looking to raise funds for reinvestment in their core operations. 

Previously, industrial SLB transactions in Korea were limited due to regulatory restrictions and were mostly carried out in the form of government-supported programs by public institutions such as the Korea Asset Management Corporation (KAMCO). 

The revision of the "Industrial Cluster Development and Factory Establishment Act" (commonly known as the Industrial Cluster Act) in 2024 has established the legal basis for SLB transactions, rekindling interest in private capital investment in such deals. The new provisions specifically apply to companies located in industrial complexes outside the Seoul metropolitan area. Eligible entities for acquiring industrial land and factories now include financial investment companies, real estate investment trusts (REITs), and public institutions. Additionally, the law gives tenant companies that sell their assets through SLB structures the opportunity to repurchase those assets in the future. This provision is intended to ensure that companies can continue operating stably, even after monetizing their real estate assets.

In response to these changes, Cushman & Wakefield will now offer industrial SLB services through its Logistics & Industrial team, which has extensive experience with the acquisition and sale of various industrial real estate assets, including logistics centers, factories, data centers, and R&D facilities for major domestic and global corporations. 

YK Son, Senior Executive Director of Cushman & Wakefield Korea’s Capital Markets Group, stated, “This legal revision not only broadens capital-raising opportunities for companies but also provides a new avenue for institutional investors who have faced challenges in investing in industrial real estate in Korea, Cushman & Wakefield Korea’s SLB service will leverage these regulatory improvements to help companies address cash flow challenges. We also anticipate that these changes will create excellent investment opportunities for both domestic and global investors looking to invest in core assets of major Korean corporations.”