[Exclusive] Kolon affiliates build new facility on Honorary Chairman Lee Woong-yeul’s land, “to be used as group history hall”

[비즈한국] It has been confirmed through BizHankook’s reporting that affiliates of Kolon002020 Group, the 38th largest business conglomerate in Korea, have recently completed the construction of a building on land in Seongbuk-dong, Seoul, owned by the group's head, Honorary Chairman Lee Woong-yeul. This area is one of Korea’s most affluent neighborhoods, densely packed with foreign embassies and luxury residences; Honorary Chairman Lee maintains his own private home on a plot adjacent to this construction site. Why did the Kolon Group affiliates build a facility on the chairman's personal land? And how much are they paying for the use of the land? BizHankook delved into the background of the construction project in Seongbuk-dong by Kolon affiliates.

It has been confirmed through BizHankook’s reporting that affiliates of Kolon Group, the 38th largest business conglomerate in Korea, have recently completed the construction of a building on land in Seongbuk-dong, Seoul, owned by the group's head, Honorary Chairman Lee Woong-yeul (pictured). Photo = Reporter Choi Joon-pil

According to BizHankook's reporting, Kolon, the holding company of Kolon Group, along with operating companies Kolon Industries120110, Kolon Global003070, and Kolon Mobility, completed the construction of a building on land owned by Honorary Chairman Lee Woong-yeul in Seongbuk-dong, Seongbuk-gu, Seoul, on the 1st. The building consists of three basement levels and two above-ground floors (total floor area of 1,415㎡), and its registered purpose is listed as a rest area, restaurant, and exhibition space. Honorary Chairman Lee inherited this 758㎡ plot of land and the detached house situated on it from his father, the late Honorary Chairman Lee Dong-chan, in November 2014. The Kolon affiliates began construction on the new building after demolishing the existing structure in August 2023.

The name of the building constructed by the Kolon affiliates on Honorary Chairman Lee’s land is "LOOKN." Just before construction began, Kolon filed for trademarks for the names "LOOKN" and its English counterpart "LOOKN" in June 2023. The goods and services designated for these trademarks include 14 items in Class 28 (toys, golf equipment, etc.), 16 items in Class 30 (coffee, snacks, etc.), 12 items in Class 36 (real estate, etc.), and 19 items in Class 43 (restaurant and hotel services, convention facility services, etc.). These trademarks were registered in June of the same year, but no signs of their use in commercial activity have been found to date.

The actual purpose of the building constructed by Kolon affiliates on Honorary Chairman Lee’s land has yet to be determined. On-site verification confirms that the building has received its occupancy permit and is currently undergoing interior and exterior finishing work. As the building is not yet in use, it remains to be seen whether its actual usage will align with its registered purpose. An official met at the construction site stated, "We are currently conducting interior and exterior finishing work. It will likely take another month or two to finish. The purpose is indeed for an exhibition space."

A view of the building constructed by Kolon affiliates on Honorary Chairman Lee Woong-yeul’s land in Seongbuk-dong. It has received an occupancy permit and is currently undergoing interior construction. Photo = Reporter Cha Hyung-jo

The land owned by Honorary Chairman Lee, where the Kolon affiliates built the facility, is adjacent to his private residence. Honorary Chairman Lee purchased the land bordering his property around December 1976, when his father, the late Honorary Chairman Lee Dong-chan, held the plot. In May 2001, he built a detached house (1,177㎡ total floor area) on this property, which he has used as his residence. Honorary Chairman Lee previously held two adjacent houses in the area, including the existing detached house that stood on the land where the Kolon affiliates have now constructed the new building.

The Kolon affiliates have secured the right to use Honorary Chairman Lee’s land for 50 years in exchange for payment. The co-owners of the new building—Kolon (1% stake), Kolon Industries (46%), Kolon Global (31%), and Kolon Mobility (22%)—signed a superficies contract with Honorary Chairman Lee in March 2023, prior to the start of construction. The contract allows for the use of the land for 50 years until March 2073, with an annual land rent of 14 million won, for the purpose of owning the reinforced concrete building. Further terms, such as whether the building will remain or if ownership will be transferred upon the expiration of the superficies, remain unconfirmed.

Honorary Chairman Lee Woong-yeul, the landowner, is the head of Kolon Group. As of March this year, he holds a 49.74% stake in Kolon, the holding company of Kolon Group. Honorary Chairman Lee served as the group’s chairman for 22 years from 1996 to 2018 before announcing his retirement from management and becoming honorary chairman. Currently, group management is led by his only son, Lee Kyu-ho, Vice Chairman and CEO of Kolon, but the chairmanship and the ownership stake have not yet been passed down. Kolon Group is the 38th largest business group in Korea (with total fair assets of 15.17 trillion won), encompassing operating companies such as the chemical material and fashion firm Kolon Industries, the construction company Kolon Global, and the imported car distributor Kolon Mobility Group450330.

A Kolon representative only stated, "I understand it (the new building) will be used as a group history hall, but I think the details will need to be verified."