Finding the Hidden Opportunity ...... 2025

Background

In 2025, at the request of a client, we began searching for logistics warehouse opportunities in the Cheonan region. Contrary to initial expectations, it was not easy to identify suitable candidate properties. Eventually, we discovered a newly built logistics center in Yulgum-ri, with a floor area of approximately 18,000 pyeong (≈ 59,500 m²). Apart from being somewhat distant from the Seoul metropolitan area, the facility exceeded standards in terms of size and specifications. At the time, leasing activity was in progress, and we assessed that the property had strong potential as a sales asset once stabilized.

Market Tapping and Sales Progress

Subsequently, we maintained continuous communication with the seller while testing the market. By early 2025, preliminary acquisition interest—primarily from foreign investors—began to surface. Their willingness to invest was largely contingent upon leasing progress. However, market understanding of the Cheonan logistics sector was still very limited, making acquisition decisions difficult.

Existing market reports only provided broad overviews of trends. Therefore, we conducted an in-depth market study focused on the subject property and its surrounding area, including logistics supply, tenant composition, and vacancy levels. The analysis confirmed that demand outweighed supply, and this insight was shared as supporting material to assist potential buyers in their decision-making process.

The sales structure was open-bid, where multiple agencies proposed buyers, and the seller would select one agency to act as sales advisor. For us, this was the first critical hurdle. Regardless of the quality of the buyer we introduced, failure to be selected meant that all prior efforts would yield no reward.

The key to persuading the seller was demonstrating closing stability. We emphasized our track record of successful closings with the proposed buyer, leveraging past deal experience. In addition, both our firm’s reputation and the buyer’s market standing, confirmed through the seller’s network, played an important role. Ultimately, our firm and our proposed buyer were granted preferred negotiation rights, and we successfully closed the transaction—albeit with the inevitable challenges that accompany every deal.

Lessons Learned

1. Reputation is the foundation of any deal

   • Negotiations without trust have a low probability of success.

2. Understand the market in detail, not abstractly

   • Avoid blanket statements like “that region doesn’t work” without data; rely on specific, fact-based insights.

3. Pursue a win-win approach

   • Negotiations driven solely by self-interest undermine success; sustainable outcomes require creating value for all parties.