South Korea’s Mirae Asset Daewoo Securities Co., Hana Financial Investment Co., and HMC Investment Securities Co. will together purchase an office building in Plainsboro, New Jersey, for about 350 billion won ($299 million) as part of their efforts to diversify investment assets in a protracted low interest rate environment.

According to multiple sources from the investment bank industry on Tuesday, the three Korean brokerages have decided to jointly invest 150 billion won to acquire the headquarter building of global healthcare company Novo Nordisk in New Jersey, the United States, through a real estate fund created and managed by Hana Asset Management Co. They plan to source the rest of the total purchase price of 350 billion from loans of financial institutions. The investment is expected to generate an annual return of 7 percent, according to sources.

The office building of Novo Nordisk resting on a total floor area of 68,000 square meters was reconstructed three years ago and is adjacent to Princeton University, one of the top three Ivy League schools in the United States. The building has been rented out to Novo Nordisk, a Denmark-based healthcare company known for its insulin diabetes treatment and NovoPen series, an insulin pen injector, for more than 10 years. The multinational company has over 40,000 employees across 75 countries and exports healthcare products to 180 countries.

An unnamed official from one of the three securities firms said the fund plans to resell the property to local institutional investors including pension funds and insurance firms. The official added that the fund will continue to search for more overseas real estate investment opportunities as part of efforts to find new profit sources. Like their rivals in the global financial industry, a prolonged low interest rate environment has put Korean brokerages under pressure to seek alternative assets.

By Song Gwang-sup

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