MDM Group, South Korea's largest developer, reported a decline in revenue last year due to a slowdown in its main business operations. The drop in sales reflects a gap in property sales following the completion of major projects. However, the company is poised for a rebound, leveraging its strong financial position to pursue large-scale developments in Seoul and Busan.
According to a financial report released on June 28 by the Financial Supervisory Service, MDM's consolidated revenue for 2025 was approximately 128.8 billion won, with an operating profit of about 18.4 billion won. This represents a significant decrease of 60.9% in revenue and 85.5% in operating profit compared to the previous year, which saw revenues of around 329.1 billion won and operating profits of about 126.6 billion won.
MDM Plus, the group's largest subsidiary, also experienced a 5.5% decline in revenue, reporting approximately 986.1 billion won for 2025, down from about 1 trillion won the previous year. Despite this, MDM Plus showed improved profitability, with an operating profit of around 344 billion won, a 6.7% increase from approximately 322.5 billion won in 2024. Notably, net profit attributable to shareholders surged to about 196 billion won, up from approximately 142.5 billion won the previous year.
The increase in profitability can be attributed to the final sales revenue from high-end projects like 'Acro Yeouido The One,' improved margins, and a significant reduction of about 100 billion won in interest expenses, which helped offset the overall decline in revenue.
The decrease in sales figures is largely due to structural gaps. Major projects, such as the e-Pyeonhansesang Yongin Station Platform City, were completed in 2024, leaving MDM with only two sales projects last year: the Unjeong Prugio Park Line and two residential lots in Dongtan. This resulted in a lack of new pipeline projects.
Nevertheless, MDM maintains a strong financial foundation, with a debt ratio of just 13.9%, indicating virtually debt-free management. The company holds cash assets of 150 billion won, with short-term liabilities totaling only 15.1 billion won. Retained earnings stand at 1.2441 trillion won. MDM Plus also maintains a debt ratio of 95.5%, with undistributed retained earnings of 1.6945 trillion won, bringing the total for both companies to approximately 2.9386 trillion won.
The group's next growth phase involves simultaneous large-scale projects in Seoul and Busan. The Sori-Pul Complex Development will be located on the former site of the National Military Intelligence Command in Seocho-gu, Seoul, covering 165,000 square meters. The project includes five office buildings, a 760-seat performance venue called 'Sori-Pul Sound,' South Korea's first open art museum 'Sori-Pul Visible Storage,' and commercial facilities. With a total floor area of about 600,000 square meters, it is set to be the largest office development in South Korea's history. The project secured a record 5.35 trillion won in project financing last June and broke ground in July, aiming for completion in the first half of 2030.
In Busan, MDM is developing a mixed-use project on the former site of the Grand Hotel, which spans 12,594 square meters. This development will consist of four buildings with 286 hotel rooms, 76 condos, and 352 officetels, designed by German architect Ole Scheeren. After obtaining building permits in December, the bidding process for construction companies is currently underway, although it has faced some delays. Completion is also targeted for 2030.
Looking ahead, MDM plans to transition from relying solely on sales revenue to a comprehensive real estate platform that encompasses asset ownership, leasing, and operations post-development. The company expects that the completion of the Sori-Pul and Haeundae projects in 2030 will mark the beginning of a new revenue model that integrates development and operations.
However, there are uncertainties. A key concern is whether there will be sufficient demand to fill the 180,000 square meters of office space after the Sori-Pul project is completed. Some industry experts suggest that its proximity to the core business district of Gangnam could pose a risk.
An MDM representative stated, "The Sori-Pul Complex Development broke ground in July of last year, and construction is progressing smoothly. The Haeundae project is currently in the bidding phase for construction companies." They added, "Chairman Moon Joo-hyun emphasizes the concept of compact cities, aiming to enhance urban competitiveness through high-density development within city centers, aligning with our core mixed-use development philosophy."
* This article has been translated by AI.
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