Mirae Asset Group is facing significant write-downs on its 2019 acquisition of the Majunga Tower in La Défense, Paris, as the district’s office market continues to deteriorate. The 47-story skyscraper—once seen as a landmark trophy asset—has now emerged as a cautionary tale of Korea’s aggressive overseas office investment wave in the late 2010s.

As of end-2024, cumulative losses on the investment have reached approximately 76%, with further downside risk remaining.

In April 2019, Mirae Asset Securities, in partnership with Amundi Real Estate, acquired the Majunga Tower for KRW 1.083 trillion (approximately USD 796.3 million). At the time, it was one of Korea’s largest single-ticket property investments abroad.

The tower, standing 194 meters tall with 47 floors, was the fourth tallest in France when completed in 2014 and was expected to benefit from its location in Paris’ largest business district.

To facilitate the deal, Mirae’s affiliate Multi Asset Global Investments established two investment vehicles—Multi Asset Overseas Real Estate Investment Trust No. 6 and 6-1. However, the sell-down of investor shares was incomplete, leaving Mirae with significant retained exposure. The firm currently holds 71% of Fund No. 6 and 99% of Fund No. 6-1.

According to Mirae’s latest business report:

• 
  
• Fund No. 6:
• 2019 capital: KRW 341.4 billion (approx. USD 251 million)
• 2023 capital: KRW 175 billion (approx. USD 128.7 million)
• 2024 capital: KRW 82.7 billion (approx. USD 60.8 million)
• 
  
• Fund No. 6-1:
• 2019 capital: KRW 105.4 billion (approx. USD 77.5 million)
• 2024 capital: KRW 24.5 billion (approx. USD 18 million)

The funds have recorded substantial asset impairments over two consecutive years. Multi Asset was formally merged into Mirae Asset Global Investments in 2024, consolidating the losses into Mirae’s broader balance sheet.

The investment downturn is closely tied to the structural decline in La Défense’s office leasing fundamentals. Vacancy rates in the submarket rose from under 5% in 2019 to 15% in Q2 2024. Deloitte projects the rate will hit 19% by early 2025. In contrast, Paris’ Central Business District (CBD) maintains a healthy 2.9% vacancy rate.

As pandemic-era remote work trends fade, office demand has shifted decisively toward downtown Paris locations, leaving aging towers in La Défense under pressure. Local media reports warn that, without significant renovation, vacancies could exceed 40% within the next decade.

Most buildings in La Défense are over 20 years old, raising concerns over competitiveness and long-term viability without major capital upgrades.

“At this point, the aggressive buying spree in La Défense by Korean firms is clearly catching up with them,” said a senior executive at a global asset manager. “Property values have taken a hit, lenders aren’t extending more credit because of LTV limits, and no one wants to throw in more equity for tenant fit-outs. Everyone’s frozen.”

The Majunga Tower situation echoes other distressed Korean investments in Europe, including the Trianon building in Frankfurt and the Toison d'Or (TDO) building in Brussels—raising alarms about over-exposure to suburban European office assets acquired at market peak valuations.

Unless significant recapitalization can be secured, the risk of near-total loss on this asset cannot be ruled out.

This article was originally published by Corebeat on April 16, 2025.