Gangnam Dogok-dong Yangjae Station 24.8 Billion Won Small Building Analysis: Ultra-Station Area New Construction Development, GTX Boost and Investment Value (ft. Medical Building)
Yangjae Station area in Dogok-dong, Gangnam-gu, Seoul, is a region that always attracts keen interest from real estate investors due to its abundant foot traffic, active commercial activities, and future development boosts. News of a small building located directly in front of the Yangjae Station exit being transacted for a substantial 24.8 billion Won shows the vitality of the real estate market in core Gangnam and provides significant implications for investors. Today, we will delve into this transaction case to conduct an in-depth analysis of the investment value of a small building in the Yangjae Station ultra-station area, its potential for new construction development, and the synergy effect with future boosts like GTX.
Gangnam-gu Dogok-dong 957-3, Transacted for 24.77 Billion Won
The building we will examine is located at Dogok-dong, 957-3 in Gangnam-gu, and it was transacted for 24.77 billion Won in February 2025.
Key Features and Location Analysis of the Transacted Building:
- Yangjae Station Ultra-Station Area 'Golden Location': It is an undisputed 'ultra-station area' building directly adjacent to the exit of Yangjae Station on Subway Lines 3 and Sinbundang Line. The overwhelming accessibility right in front of the station exit, where numerous people pass by, is the most powerful factor maximizing the building's value as a commercial and office facility. It fronts a 7-lane main road, ensuring excellent visibility.
- GTX Complex Transfer Center Development Boost: Yangjae Station is scheduled for development as a complex transfer center where the Metropolitan Express Railway (GTX) Line C will stop. This is expected to further strengthen Yangjae Station's function as a transportation hub and dramatically increase foot traffic. The GTX development boost represents the future value that will have the largest impact on real estate value appreciation in the Yangjae Station area.
- General Commercial Zone: This building is located in a 'General Commercial Zone'. General Commercial Zones are areas developed primarily for commercial and office functions, with high building coverage and floor area ratios, allowing for high-density development. This suggests that while the current total floor area (300.55 pyeong) is small relative to the large land area (119.79 pyeong), there is high development potential to build a much larger building by maximizing the floor area ratio during future new construction.
- Land Area and Price Per Pyeong: The land area is 119.79 pyeong, and the sale price of 24.77 billion Won corresponds to approximately 206.78 million Won per pyeong based on the land area. This price, exceeding 200 million Won per pyeong, clearly demonstrates the overwhelming land value of a location in the Yangjae Station ultra-station area and a General Commercial Zone.
- Building Status: It is a B1F to 4F building completed in February 1985. While it is an old building, it is likely that the investment was made with new construction development in mind. Although it is mentioned as having the disadvantage of being narrow in the front and long vertically, this is a factor that can potentially be addressed during new construction design.
- Past Transaction and Loss History: After being transacted for 22.08 billion Won in October 2023, it was re-transacted for 24.77 billion Won in approximately 2 years, recording a capital gain of 2.69 billion Won. The history of being previously transacted for new construction purposes with the adjacent building but being sold at a loss suggests there were difficulties in the past development process for this plot. However, despite this past history, the current transaction was successfully concluded, likely due to the location and future value being highly evaluated.
2.69 Billion Won Capital Gain in 2 Years, New Construction Development Expectation 'UP'
The fact that this building recorded a substantial capital gain of 2.69 billion Won in approximately 2 years is a result of the value of the Yangjae Station ultra-station area location combined with expectations for future new construction development.
Investment Profit Analysis:
- October 2023 Transaction Price: 22.08 billion Won (approx. 184.00 million Won per pyeong)
- February 2025 Transaction Price: 24.77 billion Won (approx. 206.78 million Won per pyeong) (Held for approx. 2 years)
- 2 years: 2.69 billion Won capital gain
- Annual: 1.345 billion Won capital gain
- Monthly: 112.08 million Won profit (Simple capital gain analysis only)
In just 2 short years, the building's price increased by 2.69 billion Won, and the price per pyeong jumped significantly from the 180 million Won range to the low 200 million Won range in approximately 1.3 years. This calculation is based solely on simple capital gain and does not include rental income generated during the holding period, building maintenance costs, taxes, and importantly, 'new construction costs'. The rapid increase in a short period demonstrates the high market valuation of the Yangjae Station ultra-station area location and expectations for new construction development potential.
Synergy Effect of Anticipated Interest Rate Cuts and Development Boosts
Recently, as the possibility of an interest rate cut by the Bank of Korea has increased, expectations for the real estate market are growing. Particularly, in the Gangnam area, investment demand is expected to increase further with more abundant liquidity when interest rates are lowered, and interest in revenue-generating properties such as small buildings is also expected to rise. Added to this is the major boost of the Yangjae Station GTX complex transfer center development, injecting a positive atmosphere into the Gangnam real estate market. Like a 'trawler' fishing net, the combination of interest rate cuts and development boosts is expected to further accelerate real estate value appreciation in the Yangjae Station area.
Outlook for Utilization as a Medical Building etc. After New Construction
Although this is an old building, based on its prime location directly in front of the Yangjae Station exit, a strategy to increase its value through new construction development can be planned.
- New Construction Development Potential: By utilizing the high floor area ratio of the General Commercial Zone, a much larger building can be constructed compared to the existing one. The disadvantage of having a narrow front and long vertical plot shape can be overcome through efficient space planning during new construction design.
- Potential for Use as a Medical Building: Yangjae Station area is adjacent to both core Gangnam business districts and residential areas, resulting in steady demand for medical facilities. After new construction, it is highly likely to be utilized as a medical building with various departments such as plastic surgery, dermatology, and dentistry. Medical buildings are a type that can expect relatively stable rental income. The fact that previous tenants were high-quality ones like 투썸플레이스 (Twosome Place) and a hospital also supports this utilization potential.
- Utilization as Office Facilities: Besides a medical building, utilizing it as a general office building to attract rental demand from office workers in surrounding business facilities is also a possible strategy.
Future Investment Outlook and Precautions
Office buildings in the Yangjae Station ultra-station area are attractive investment properties with expected steady value appreciation in the future, based on various boosts such as the GTX complex transfer center development. Particularly, if the building's potential is maximized through new construction development, high investment returns can be expected.
However, the following precautions should be considered during investment:
- Costs and Time Related to New Construction Development: New construction requires significant costs and time. The risk of unexpected cost increases or delays in construction time should be fully considered.
- Building Regulations and Laws: Even in a General Commercial Zone, it is necessary to carefully check any specific building regulations or district unit plans applied to the Yangjae Station area and seek expert advice.
- Rental Demand and Competitive Environment: Carefully analyze the expected rental rates and risk of vacancy after new construction, as well as the competitive environment with surrounding new office buildings.
- Past Transaction History: The history of being previously sold at a loss suggests the possibility that there were some difficulties in the development process for that plot in the past. A thorough check and analysis of such aspects are necessary.
Detailed Transaction Analysis
Let's examine the specific transaction details of the building at Dogok-dong 957-3, Gangnam-gu.
※ Transaction Details
- Location: Gangnam-gu Dogok-dong 957-3
- Subway Station: Yangjae Station
- Transaction Date: February 2025
- Sale Price: 24.77 billion Won
- Land Price (Per Pyeong): 206.78 million Won
- Land Area: 119.79 pyeong (396㎡)
- Building Area (Total Floor Area): 300.55 pyeong (993.56㎡)
- Zoning District: General Commercial Zone
- Floors: B1F ~ 4F
- Road Condition: 7-lane road
- Year of Completion: February 19, 1985
- Official Standard Land Price (공시지가): Approx. 124.36 million Won (Per Pyeong)
- Land Price Relative to Official Standard Price: Approx. 1.66 times
※ Past Transaction History
- October 2023: 22.08 billion Won sale (184.00 million Won per pyeong)
- February 2025: 24.77 billion Won sale (206.78 million Won per pyeong) (Held for approx. 2 years)
- 2 years: 2.69 billion Won capital gain
- Annual: 1.345 billion Won capital gain
- Monthly: 112.08 million Won profit (Simple capital gain analysis only)
This transaction is a case where a building with a land area of approximately 120 pyeong and a total floor area of 300.55 pyeong (B1F to 4F) was transacted for 24.77 billion Won, at approximately 206.78 million Won per pyeong. It is located in the ultra-station area directly in front of the Yangjae Station exit, in a General Commercial Zone, and was completed in 1985. Compared to the 2023 transaction price, it recorded a capital gain of 2.69 billion Won in approximately 1.3 years, clearly demonstrating the rapid appreciation of the Yangjae Station ultra-station area location. The total floor area is small relative to the land area, indicating high potential for new construction development, and the ratio of land price to official standard price also suggests potential for further market appreciation.
Conclusion: Yangjae Station Small Building, Golden Opportunity Created by GTX and New Construction Development
The case study of the 24.77 billion Won small building in front of the Yangjae Station exit in Dogok-dong, Gangnam-gu, clearly demonstrates the overwhelming investment value of the golden location in the Yangjae Station ultra-station area and its new construction development potential. The significant capital gain of 2.69 billion Won recorded in just 2 years is a result of the combined effect of the power of the location, expectations for the GTX development boost, and the possibility of interest rate cuts. Although it is an old building, it has high potential to maximize its value by transforming it into a medical building or office facility through new construction.
Investing in Yangjae Station small buildings involves a high initial investment cost and risks related to new construction development. However, based on the Yangjae Station ultra-station area location, the GTX development boost, and the development potential of the General Commercial Zone, it is an attractive option that offers the potential for long-term asset value appreciation and high investment returns. We hope you seize opportunities for investing in Yangjae Station small buildings through thorough analysis and expert advice.