ESR Kendall Square has officially terminated its forward purchase agreement for the Siheung Decon Complex Logistics Center in Gyeonggi Province.

Koramco Asset Management, which backed the development, is now expected to secure tenants for the vacant building and move ahead with a resale once occupancy stabilizes. 

According to industry sources on June 11, 2025, LOGOS — the Australian logistics investment firm — signed the forward purchase agreement back in 2022 to acquire the large-scale complex in Jeongwang-dong, Siheung-si, for about USD 188.4 million (KRW 260 billion).

At that time, LOGOS executed the deal via KB Asset Management, as it had yet to secure its own Korean asset management license. LOGOS later came under ESR ownership through ARA Asset Management and was integrated into ESR Kendall Square.

The project was developed by Decon Co., Ltd. and Koramco Asset Trust through a dedicated PFV called ‘Decon Plus.’ The asset includes four ambient floors and three floors of cold storage space. 

Under the agreement, LOGOS paid a deposit of about USD 4 million (KRW 5.5 billion) and interim payments of roughly USD 12 million (KRW 16.5 billion). The remaining USD 174 million (KRW 240 billion) was due by September 2024 — matching the PF loan maturity.

However, the cold storage portion failed to attract tenants amid shifting market demand, resulting in sustained full vacancy. With no pre-leased space in place, Kendall Square Asset Management ultimately decided to walk away from the deal rather than take on the leasing risk in a softening market.

After negotiations, the developer agreed to return 50% of the deposit and interim payments — about USD 8 million (KRW 11 billion) — allowing both sides to avoid lengthy legal disputes.

An industry insider noted, “In these forward purchase deals, a buyer pulling out often sparks drawn-out lawsuits over who’s at fault and how much of the deposit is forfeit. This time, the parties managed to settle it without a court battle.”

The property sits within the Sihwa National Industrial Complex. Koramco Asset Management, which holds PFV preferred shares through its industrial fund, is working to bring in tenants. Once a stable lease profile is secured, the asset is expected to be brought back to market for a fresh sale attempt.

Key lenders on the project include Korea Investment & Securities (about USD 50.7 million, KRW 70 billion) and KDB Infrastructure Asset Management (KIAMCO) Fund (around USD 44.9 million, KRW 62 billion).

This article was originally published in Corebeat on June 11, 2025.