EXCLUSIVE: AIG seeks $450m for Asia legacy asset

Jones Lang LaSalle has been mandated to sell the hotel component of the massive International Finance Centre in Seoul for as much as $450m in a deal that would see AIG’s legacy real estate in Asia whittled down further.

AIG Global Real Estate (AIG GRE), the real estate investment management business of bailed-out American insurer American International Group, is preparing a sale from the one of the last assets on its books in Asia, PERE can reveal.

The firm has mandated property broker Jones Lang LaSalle (JLL) to market the 434-room Conrad Seoul, a luxury hotel that forms part of AIG GRE's massive, mixed-use International Finance Centre complex in the Yeongdeungpo-gu administrative district in the south west of Seoul. 

No guide price for the approximately 1 million square foot building was included in a marketing document, obtained by PERE, and JLL would not comment. However, it is believed to be asking for as much as $450 million for the asset. JLL is expected to call for bids next month. International and domestic institutions are expected to submit bids, as well as other real estate investment management firms. 

The complex, which is the only asset within a bespoke, commingled fund managed by the firm, was not part of a deal struck at the turn of 2011 between AIG and US investment manager Invesco for the transfer of its Asian real estate business. That deal saw $5.4 billion of assets across six investment funds and various separate accounts handed over and those constitute the bulk of Invesco Real Estate’s platform in Asia today.

It occurred in the aftermath of the global financial crisis, a time which saw AIG forced to accept $182.3 billion of Federal Reserve bailout funds and kick-started a global sell-off around the world including that of large properties in key markets like New York and Tokyo.

Also destined for the door at one stage was AIG GRE itself, which then managed $12.4 billion of assets. The platform ultimately survived and since 2012 it has been recalibrating its strategy with an onus on investing into the recovering US market.

AIG GRE states, as of the end of March this year, it managed approximately $30 billion of properties, also now including its 120,000-strong home AIG Affordable Housing division.

It is led by president and chief executive officer Robert Gifford while the man responsible for its residual Korea exposure is managing director William Freeman.