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https://www.koreatimes.co.kr/path/A2025042315050000543
By Yi Whan-woo
Asset management companies are returning to the hospitality sector �� specifically hotels �� after avoiding it during the COVID-19 pandemic, as surging demand from foreign tourists now exceeds the available supply, industry officials said Wednesday.
The number of international tourists visiting Korea is expected to reach 17.5 million in 2025, up from 16.37 million in 2024 �� a figure that represented 93.5 percent of pre-pandemic levels, according to the Korea Culture and Tourism Institute.
The institute said inbound tourism is recovering faster than domestic hotels can accommodate, noting that the current number of hotel rooms available in Seoul is less than half of what was available during the pandemic.
Given the circumstances, several asset management companies have recently added hotels to their post-pandemic business portfolio restructurings.
Some others, already involved in the hotel business, have decided to retain their buildings for accommodation purposes after initially converting them into office space.
BlueCove Investment, a real estate management firm, is in the final stages of acquiring the New Oriental Hotel in Seoul�셲 Myeong-dong shopping district as part of its plan to expand hotel operations starting in the second half of 2024.
The company was also selected as the preferred bidder in March to acquire a Shilla Stay branch in Dongtan, a town on the east side of Hwaseong, Gyeonggi Province. Shilla Stay is a rapidly growing hotel brand that primarily caters to business travelers.
In addition, BlueCove teamed up with Blackstone, a U.S. alternative investment management company, to buy the headquarters of SM Group for 120 billion won ($84.25 million) in November 2024.
Located in southern Seoul, the headquarters was originally a hotel, but SM Group renovated it into an office building to house its affiliates.
The BlueCove Investment-Blackstone partnership plans to reopen the building as a hotel, according to industry officials.
Gravity Asset Management, a mid-sized market player, has been working to boost growth in the hotel business since its establishment in 2022.
It partnered with U.S.-based alternative investment firm Angelo Gordon to buy Tmark Grand Hotel in central Seoul in September 2024.
The hotel was originally planned to be converted into an office building after incurring significant losses for its previous owner, Hana Alternative Asset Management, during the pandemic.
However, the Gravity Asset Management-Angelo Gordon team ultimately decided to use it for accommodation purposes.
A hotel industry official said hotel transactions nationwide more than tripled to 1.63 trillion won in 2024, compared to 2023. The official predicted that transactions will reach 2.3 trillion won in 2026.
