It’s Friday afternoon in Anaheim, the Residence Inn office has been cleaned up after the grand opening party the day before and S. Joon Kim is upstairs in a tiny conference room finishing

some last-minute business before flying back to Korea. Kim’s company is the owner of this new hotel and a harbinger of something Southern Californians can expect to see more of: Korean

investors. In less than 3 years, Korea has greatly liberalized its once-strict prohibitions on investment abroad. This all-suites hotel just a hop and a skip from Disneyland is the first

U.S. investment by Ssangyong Construction Co. Ltd., one of the world’s larger construction companies. But it is unlikely the Koreans will ever gain as high a profile in the U.S. real estate

developer.” That may be partly because all the good buildings that went on the block in Los Angeles and New York in the last few years have already been bought by foreign investors, who had

poured an estimated $9 billion into U.S. real estate midway through last year. Koreans such as Kim worry that the deluge of cash may eventually create a backlash, so Ssangyong is keeping a

relatively low profile for the time being. “I’m a little afraid these investments might create a negative feeling toward foreigners,” says Kim, whose brother is chairman of Ssangyong

Construction’s parent company, Seoul-based Ssangyong Group. “Since the Japanese bring in a lot of cash, it pushed up the cost of buildings and even housing.” One reason the Japanese are

willing to pay what are regarded as very steep prices for U.S. real estate is because interest rates are low in Japan. So borrowing a lot to pay what would be an almost unprofitably high

price for a building here makes more sense to Japanese investors. That is not the case in Korea, where interest rates are higher, says Kyu Pyung Han, executive vice president of Ssangyong

International Inc., the construction company’s U.S. unit. Political Reasons In fact, Korea loosened its grip on its business community’s cash partly for political reasons, says Kim, the

company president. With a trade surplus for the last 3 years, the Koreans see it as politic to invest some of that cash in their trade partners, he says. The liberalization of investment

policy comes at a convenient time for Ssangyong in particular; the international construction market is way off, partly as a result of the Middle Eastern oil countries cutting back ambitious

building programs. Ssangyong is still working on a few projects there, but otherwise “the market is dead,” Kim says. The company--with $400 million in revenues last year--builds in 12

countries, primarily in Southeast Asia, and has built some of the biggest hotels in places like Singapore. The parent company--a $5.5-billion concern and Korea’s fifth-largest company--makes

everything from cement to paper to electronics to cars. Now that Ssangyong can own what it builds abroad, it will be doing a lot more development deals with local partners, Kim says,

although the construction business will remain its bread and butter. Tustin Developers For instance, the Residence Inn in Anaheim, an all-suites hotel managed by Marriott, was developed in

partnership with Tustin developers William E. Swank Sr. and William E. Swank Jr. Ssangyong has 70%. Another hotel in San Diego--about half-finished--is also being developed with local

partners. The company has never had much straight construction work in the United States, and is not likely to, Kim says. But Han, the executive vice president who is based in San

Francisco--there is another office in Garden Grove--has identified other U.S. markets where the company would like to do some development deals, such as Sacramento and Seattle. While they’re

starting small, in the next few years the Koreans could become much bigger players in the real estate industry now that the sky’s the limit on foreign investments. “After San Diego, we have

nothing in hand,” Kim says. “But we’re reviewing a lot of things.” MORE TO READ