Rainfield Investment Advisory closes W50b junior loan for Sinchon housing project

Rainfield Investment Advisory said Saturday it has closed a 50 billion won ($37.3 million) subordinated loan for a residential development project in the Sinchon area of Seoul.

According to investment banking industry sources, special-purpose vehicle Rain River First closed a 50 billion won subordinated loan for the Zone 4-9 residential development project in Sinchon's Improvement Zone 4. Rainfield Investment Advisory, a real estate development and real estate finance specialist, served as asset manager for Rain River First.

The project involves developing 383 residential units in the Nogosan-dong 106-9 area of Mapo-gu, near Sogang University Station on the Gyeongui-Jungang Line. The area offers convenient access to workplaces but has long been flagged for its concentration of aging and substandard buildings, raising calls for improvements to the urban landscape and infrastructure.

The borrowers are Geonsa Retail & Estate Co. and Dosimihak The Value Co. The two have been pursuing development across three blocks within Sinchon Improvement Zone 4 — Zones 4-1, 4-9 and 4-12. For the Zone 4-9 project, the total loan commitment signed between the borrowers and the lender group stands at 170 billion won, of which Rain River First holds the 50 billion won subordinated tranche. The proceeds will be used to cover land costs and repay existing debt.

The full loan, including the subordinated tranche, matures 12 months from the date of disbursement.

For Zones 4-1 and 4-12, project ownership has been transferred from Geonsa Retail & Estate — an affiliate of the original developer Geonmul and Saramdeul — to Mapo KR Holdings, with financial restructuring now complete.

"It is especially meaningful to have closed a large-scale project at a time when raising capital is more difficult than ever," said Park Gwang-hee, chief executive of Rainfield Investment Advisory. "We will use this deal as a springboard to expand our presence in real estate finance."