On March 8, MBC’s current affairs program “Straight” aired an episode titled “Single-Person Agencies, Are You Foolish If You Don’t Have One?” The broadcast investigated how many celebrities establish one-person agencies and use them to purchase real estate such as buildings and land before reselling them to increase their assets.
During the program, the production team visited a building located in Yeoksam-dong, Gangnam District, Seoul. The building, which consists of two basement floors and seven above-ground floors, was reportedly sold for around 15 billion KRW (approximately $11 million) in 2022. The transaction had already been publicly reported at the time.
The seller was a corporation called Deep Breathing, which was reportedly a family company linked to Ryu Jun Yeol. The actor served as an internal director of the company, while his mother held the position of CEO.
According to the broadcast, Deep Breathing purchased the property in 2020 for about 5.8 billion KRW. After demolishing the existing structure and redeveloping the building, the company sold it roughly two years later, reportedly earning a significant capital gain.
The program also highlighted the high loan ratio involved in the purchase. It was estimated that Deep Breathing secured about 4.8 billion KRW in loans, roughly 80% of the purchase price, from financial institutions. Taking this into account, some analysts suggested that the actual cash investment may have been only around 1 billion KRW.
The show further pointed out that corporations often find it easier to obtain large loans for commercial real estate purchases compared to individuals.
A former bank branch manager explained during an interview, “Individual business owners undergo evaluations, but corporations do not necessarily go through the same process. Loan interest can also be recognized as corporate expenses. Most of these cases receive loans covering up to 80%.”
At the time, Ryu Jun Yeol’s side addressed the issue through his agency, explaining that the personal corporation was established to manage the actor’s income. They added that he had originally planned to develop the building with friends for a clothing business, but the project was postponed due to the COVID-19 pandemic, leading to the eventual sale of the property.
The broadcast described this strategy as a way of building wealth through leveraged investments, sometimes referred to as “debt investment.” The program cited other celebrity examples as well, including actors Hwang Jung Eum and Lee Byung Hun.
Hwang Jung Eum reportedly took out loans worth about 3.5 billion KRW under her family corporation to purchase a building in Sinsa-dong, Gangnam District. She resold the property three years and seven months later, earning around 5 billion KRW in capital gains.
Meanwhile, Lee Byung Hun purchased a building in Yangpyeong-dong, Seoul in 2018 through a corporation for 26 billion KRW, reportedly securing loans worth about 17 billion KRW. He later sold the property after roughly three years, making a profit exceeding 10 billion KRW.
Reports also stated that in 2022, Lee Byung Hun purchased another building in Oksu-dong, Seongdong District, Seoul for 24 billion KRW, taking out loans of approximately 19 billion KRW for the acquisition.
Sources: Nate
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