April 19, 2024

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Hanjin KAL, the holding company of airline-to-logistics conglomerate Hanjin Group, said Thursday it was looking to sell its non-core hotel assets to improve its financial health and shareholder value.

Hanjin KAL said invitations to bid for the assets had been sent to 12 firms including real estate consulting firms, accounting firms and asset management firms.

On Feb. 7, the company decided during the board meeting to sell assets related to its loss-making leisure and hotel business to focus on strengthening competitiveness of the core airline and logistics business.

The assets on sale include the Korean Air-owned 36,642 square meter site in Songhyun-dong in Jongno-gu, an entire 100 percent stake in Wangsan Leisure Development Corp., a leisure company that operates the Wangsan Marina resort in Incheon, and the Paradise Hotel building and some 65,000 square meters of land in Jeju, which is owned by the KAL Hotel Network.

The Korean Air-owned site in Jongno-gu, Seoul (Yonhap)

Korean Air bought the Songhyeong-dong site from Samsung Life Insurance in 2009 to construct a cultural complex, but the development has faced several hurdles due to building height restrictions and cultural asset preservation, due to its proximity to the presidential office and Gyeongbok Palace.

Hanjin Group said it would accept proposals until March 24 and finalize the candidate through evaluations and presentations.

The group said that it was also reviewing whether to put the Grand Hyatt Incheon and Los Angeles-based Wilshire Grand Center up for sale to improve business profitability.

By Kim Da-sol/The Korea Herald (ddd@heraldcorp.com)