Strategic acquisition marks expansion for Korean asset manager into prime U.S. commercial real estate

In a landmark transaction within the commercial property sector, South Korea’s Morning Calm Management has completed its acquisition of City Office REIT for $1.1 billion. The deal, announced on July 30, 2025, represents one of the largest cross-border real estate investments of the year and underscores Morning Calm’s ambition to broaden its global portfolio.

City Office REIT, listed on the New York Stock Exchange, owns a portfolio of 28 Class A office buildings located in key U.S. markets, including New York, Chicago, and San Francisco. The REIT’s properties collectively account for 12 million square feet of office space, with an average occupancy rate of 92% as of the end of Q2.

Morning Calm Management, known for its value‑driven approach, plans to inject capital into building modernizations and sustainability upgrades, targeting LEED certification for at least half of the acquired assets within three years. “We see strong long‑term demand for high‑quality office space in top-tier cities,” said CEO Kim Jae‑ho. “Our investment will enhance these properties’ operational performance and environmental footprint.”

Analysts note that the purchase price, equating to roughly $183 per square foot, represents a premium of 8% over the REIT’s closing share price prior to the offer. Institutional investors and pension funds are expected to back the financing, signaling confidence in stabilized cash flows from established urban office markets.

City Office REIT’s management board unanimously supported Morning Calm’s proposal, citing the buyer’s track record and the structured deal terms, which include a fixed 6.0% cap rate and limited leverage on the acquired portfolio. Shareholders will receive $15.50 in cash per common share, a 10% premium to the 30‑day volume‑weighted average price.

The acquisition arrives amid a broader trend of Asian capital flowing into U.S. real estate, as investors seek yield and diversification against low domestic returns. In 2024, Asia‑Pacific buyers deployed over $20 billion into U.S. commercial properties, with office and industrial sectors leading the charge.

Morning Calm will retain the existing property management teams and plans to maintain leasing operations uninterrupted. The company has also signaled interest in expanding its presence in North America through selective acquisitions in logistics and multifamily sectors.

Regulatory approval from U.S. antitrust and real estate authorities is expected by year‑end, with closing slated for Q1 2026. Upon completion, City Office REIT will delist from the NYSE and become a wholly‑owned subsidiary of Morning Calm Management.

Investors and market participants will be watching closely to assess the integration of City Office REIT’s assets into Morning Calm’s platform and the potential ripple effects on office valuations in gateway cities. The success of this deal could catalyze further cross‑border investment in the office segment, even as remote work trends continue to evolve.

For Morning Calm Management, the acquisition cements its status as a major global institutional investor and demonstrates the firm’s strategic pivot toward stable, income‑producing real estate assets amidst ongoing market uncertainties.