“I Paid 660 Million Won for Construction, but Received Nothing”: Shared-Office Operator Faces Revenue Dispute

A Gangnam building owner paid 660 million won to turn a five-story property into a premium shared-office and study-cafe space. Instead of the expected revenue, he became embroiled in a dispute over construction costs, vacancies and unpaid tenant rent.

The owner signed the outsourced-operation and interior-construction contract with a well-known study-cafe and shared-office brand in August 2024. He provided the building and paid for the renovation, while the company agreed to operate the space and share most of the profits.

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We filled a non-station-area building that had been vacant for more than five years within three months, generated monthly sales in the 20-million-won range and greatly increased its asset value.

The owner says the promised premium renovation never materialized. He alleges that the company used mostly secondhand and low-cost materials and carried out only minimal work. An appraisal by a certified loss-adjustment firm valued the completed interior at 46.45 million won, about 7% of the 660 million won payment.

He also says sales proposals led him to believe the operation would generate at least 35 million won a month. When one tenant left without paying rent, the company deducted 56 million won from the settlement for seven months, leaving him with no payments while he continued to bear interest on loans used for the renovation. He filed a police complaint against the company’s executives on suspicion of fraud and violations of the Franchise Business Act.

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The owner’s lawyer argued that the contract contains no provision stating that maintenance and repair costs were included in the construction payment.

The Seoul Gangnam Police Station decided in March not to forward the case, accepting the company’s argument that some construction had been completed and that the five-year maintenance costs were included in the 660 million won. The owner appealed, and prosecutors ordered further investigation. His lawyer says the contract contains no provision on maintenance and repairs.

The company calls the complaint baseless. It says it filled a building that had stood partly vacant for more than five years within three months, generated monthly sales in the 20-million-won range and increased the property’s value. It also says it submitted full payment records, that the rent deduction was allowed under the contract and that settlement payments have resumed. A real-estate lawyer warned that these hybrid agreements combine elements of leasing and franchising without necessarily triggering franchise disclosure and false-advertising rules, leaving room for more disputes.

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Revenue-sharing outsourced-operation contracts can create conflicts because their profit structures are opaque.