Gong Hyo-jin Puts Up Seogyo-dong Building for Sale, Priced 10 Billion Won Higher after 7 Years
Gong Hyo-jin is set to achieve significant gains in real estate investment
According to a report by Herald Economy on October 4th, Gong Hyo-jin recently put up the building ‘ROY714’ located in Seogyo-dong, Seoul, which she owns, for sale at 16 billion won (around $11,8 million). It is about 130 million won ($96,051) per 3.3㎡.
According to the real estate registration certificate, the building was purchased by the building leasing company ‘ROY714’ for 6.3 billion won ($4.6 million) in January 2016. ‘ROY714’ is a corporation in which Gong Hyo-jin owns 50% of the shares and serves as the CEO.
When buying real estate in the name of a corporation, you can borrow more money and get better interest rates than when buying it as an individual.
Gong Hyo-jin also secured a first lien right amounting to 12 billion won ($8.8 million) by using another building he held in Hannam-dong as collateral.
Immediately after the purchase, she demolished a two-story detached house and completed a new building with a total of 9 floors, including 3 underground and 6 above-ground floors, in September 2017. The floor area is 1,745.09㎡, which is much larger than the previous one.
The rental status of this building located in the Hongdae Entrance Art Street is about 580 million won ($428,423) in deposit and about 42 million won ($31,023) in monthly rent.
Personal-owned buildings are subject to a tax rate of over 40% on rental income, but if you create a corporation and engage in rental business, the income tax rate drops to half.
Herald Economy quoted experts as saying that even after deducting the cost of building construction, a minimum price difference of over 5 billion won ($3,6 million) is expected.
An industry official explained, “Considering that it is a building with a design, it is expected that the construction cost of the building in 2017 would have been around 8-9 million won per 3.3㎡. Even after deducting the construction cost of about 4 billion won, a price difference of over 5 billion won is expected when sold for 16 billion won.”
Source: Wikitree
