GS Engineering & Construction (E&C) is poised to enter the U.S. housing market, participating in a reconstruction project of old apartments in Silicon Valley, California.
Managing Director Huh Yoon-hong of GS E&C, the only son of Chairman Huh Chang-soo, is about to launch a housing business project in the Silicon Valley, California, involving the construction of “Xi” apartments in the famous location where many well-known U.S. high-tech firms are located. The initiative will be a partnership with one of his business associates in the U.S. who happens to be an old friend of U.S. President Donald Trump. Thomas J. Barrack Jr., founder and executive chairman of real estate money manager Colony Capital, was chairman of Donald J. Trump’s Presidential Inaugural Committee.
Huh told the Korea Economic Daily during an interview that he has been busy visiting jobsites of GS Construction around the world to check the company’s progress in capturing new construction projects. The interview was the first in his career as he represents the fourth generation of his family to run the group.
The managing director said GS E&C will invest in a housing project as a limited partner with a local U.S. company, under which it will buy 208 old apartment units in Mountain View, California, and reconstruct them into 600 units. GS E&C set up a corporate body for the project last year. If the reconstruction plan is approved, GS E&C's apartment brand, Xi, would be the nation's first brand to be erected in Silicon Valley.
He said the apartment complex is expected to attract IT people because of its proximity to major high-tech companies like Apple, Facebook and Google.
Google’s headquarters is only 2.6 kilometers from the site, while the Apple, Intel and Facebook headquarters are all within a 12-kilometer radius, less than a 15 minute drive from the site of the apartment complex. The late Huh Joon-koo, the third son of Min-jong, the co-founder of what is now LG Group, is his grandfather. The other fourth generation family member working for the group is Se-hong, the son of honorary chairman Dong-soo of GS Energy.
Asked when he will participate in the management of the group, he said Chairman Huh knows intimately what goes on in the construction industry and he told him to change jobs when everyone in the company knows that you are qualified for the new job, he said. Managing Director Huh helped the company secure a project to rebuild the dilapidated residential units in Mountain View and turn them into Xi apartments. To secure the project, he held talks with Colony Capital, a private equity fund, and also the third largest real estate developer in America.
They agreed to set up a consortium to undertake the project with GS Construction sharing a 40 percent stake, Colony Capital another 40 percent and Fort Bay taking over the remaining 20 percent stake.
The founder of Colony Capital is Chairman Thomas Barrack, who has been close to President Donald Trump for three decades. Huh plans to use Silicon Valley as a base for GS Construction before expanding the Xi apartments around the U.S, he said.
Huh, a U.S. college graduate, entered GS Construction as a clerk after a brief time working for GS Caltex. While he was assigned to the plant construction division of the company, he toured jobsites extensively, including those in the U.S., Canada and the Middle East
He held various important positions within the company, including the project planning team, financial team, and the cost reform and IR teams after getting promotion as a junior director. He volunteered to work for the overseas plant division in order to gain experience in overseas construction projects. He traveled frequently to places such as Kuwait, Qatar and Abu Dhabi.
A view of Village Lake Apartments in Silicon Valley, Calif. where GS E&C plans to build its Xi brand apartments after the time-worn Village Lake Apartments are removed.(Photos: GSE&C)