Late Hyundai founder Chung Ju-yung's Gahoe-dong home sells for half its appraised value

A luxury standalone home in Jongno-gu's Gahoe-dong — where the late Hyundai Group founder Chung Ju-yung spent his final years — has sold at auction for roughly half its appraised value.

The property at 177-1 Gahoe-dong, along with three adjacent lots, sold for 20.3 billion won ($15.2 million) at a fourth-round auction held Thursday at Seoul Central District Court, according to GG Auction, an auction and public sale data firm. The sale price represents 51.7 percent of the initial appraised value of 39.26 billion won.

The property first went to auction in mid-June but drew no bidders, failing to sell in three consecutive rounds. The minimum bid was lowered after each failed round, and it took four months for the price to fall to roughly half the appraised value before a deal was struck. Only one bidder participated in the final round.

"Because the price was so high, ordinary buyers were effectively shut out, which is why it failed to sell three times," said Lee Ju-hyun, a senior researcher at GG Auction. "The fact that only one person bid this time also shows just how limited the pool of potential buyers is."

The property was put up for auction after its owner defaulted on debt obligations.

The current owner, a real estate developer in her 70s surnamed Jeong, failed to repay principal and interest on financial loans, prompting the creditor to exercise its security interest. The auction was a voluntary foreclosure proceeding, in which a financial institution takes a mortgaged property to court auction to recover outstanding loan funds.

The Gahoe-dong home has a notable history beyond its connection to Chung. Park Heung-sik, the founder of Hwashin Department Store, lived there for 57 years, from 1931 to 1988.

Chung purchased the property in February 2000 for about 5.5 billion won, drawing attention at the time for leaving the Cheongwun-dong home he had built himself after 38 years.

Jeong Tae-soo, the former chairman of Hanbo Group, also lived there as a monthly tenant for about two years starting in 2003.