Songdo Int'l Business District
Development Moves into High Gear

Morgan Stanley reaches a $350 million deal on the development of the district with NSC

Morgan Stanley has agreed to invest $350 million for the development of the International Business District of Songdo, part of the Incheon Free Economic Zone.
New Songdo City Development, LLC (NSC), said on September 11th it concluded a $350 million deal with Morgan Stanley Real Estate Fund on the development of the International Business District. Cho Sung-ik, deputy minister of Free Economic Planning Office, heard the news on the agreement during his meeting at his office with Stanley Gale, chairman of the Gale Company, John B. Hynes, NSC president, Christopher Niehaus, vice chairman of Morgan Stanley, former U.S. Amb. to Korea Thomas Hubbard.
NSC and Morgan Stanley are expected to establish a Special Purposed Company (SPC) for the investment. Morgan Stanley will invest $350 million of the capital, while NSC will provide land in kind.
NSC is a 70:30 joint venture partnership between U.S. developer Gale International and POSCO Engineering and Construction, a subsidiary of Korean steel giant POSCO.
The agreement is part of a $3 billion investment plan between Morgan Stanley and NSC into the International Business District. Morgan Stanley is participating in the joint venture in the form of a stake investment.
NSC plans to develop the International Business District to accommodate the 65 floor Northeast Asia Trade Center, residential areas, office buildings, commercial buildings, a hotel and a convention center.
Initially, $150 million will be channeled during this year to launch the Northeast Asia Trade Center, office and commercial building projects and an additional $200 million will be invested, depending on the process of the projects.
Morgan Stanley's investment is likely to boost concern about the Songdo projects among domestic and foreign investors. nw

(left photo) Incheon Mayor Ahn Sang-soo talks with Stan Gale, chairman of Gale International, and John Hynes III, CEO of Gale International Korea on the development of the International Business District of Songdo. Cho Yong-kyung, vice president of POSCO E&C and domestic CEO and Gale International Korea, was also present (right photo).