Was Lee Seung-gi's 10.5 billion won jeonse a scheme to inflate property prices? 'Deposit tripled after move-in, with promise to cover interest'

Singer Lee Seung-gi: 10.5 billion won (approximately $7.6 million). Singer Baekhyun: 16 billion won.

Those are the jeonse, or long-term lease deposits, the two celebrities paid to rent units at a luxury villa in Hannam-dong, Yongsan-gu, Seoul. Both transactions set all-time records for the highest jeonse prices in the market at the time — and now allegations are emerging that the developer may have orchestrated the deals to artificially inflate the property's value.

MBC's "PD Notebook" aired an episode Monday titled "MC Mong and the Chairman's K-pop Trade Secrets," examining claims that entertainment agency One Hundred Label failed to pay its artists their settlement fees. One Hundred was founded in 2023 by Cha Ga-won, a chairman who built his fortune in real estate, in partnership with rapper MC Mong. The agency rapidly expanded its roster, signing prominent acts including SHINee's Taemin, EXO-CBX, Lee Seung-gi and Lee Mu-jin, but has drawn criticism for allegedly withholding settlement payments owed to those artists.

Cha has claimed he earned hundreds of billions of won from his luxury villa business and channeled those profits into the entertainment venture. But the unpaid settlement scandal has cast doubt on his actual financial standing.

One prominent example is La Nuvo Phase 1, a luxury villa in Hannam-dong developed by Cha's Fiarc Group. Pre-sales launched in 2022, yet all four units remain unsold. One industry insider told the program: "He tried to talk me into buying one for 10 billion won, but I passed. That place isn't even worth 5 billion won. He hasn't sold a single unit."

Both Lee Seung-gi and Baekhyun — artists signed to One Hundred — currently live in the villa. Lee made headlines in 2024 when he signed a jeonse contract for 10.5 billion won, a record high at the time. An estimated 7.3 billion won of that deposit was financed through loans. Baekhyun followed in 2025 with a 16 billion won jeonse contract — again a record — with an estimated 10.5 billion won reportedly borrowed. Both artists are believed to have qualified for such large loans because of their celebrity status.

Cha Ga-won, chairman of Fiarc Group. [Provided by One Hundred]

Lee Seung-gi's representatives told "PD Notebook" that Cha repeatedly urged Lee to move into the villa shortly after he signed with One Hundred Label. Cha did not disclose the deposit amount upfront — and only after Lee had already moved in did he demand a figure more than three times higher than what had originally been discussed, citing an appraised property value of 16 billion won. When Lee said he could not cover such a sum, Cha told him he had already arranged the loans and would personally cover all interest payments, leaving Lee with little choice but to sign the contract. The statement added that the claimed appraisal of 16 billion won was false, and that Cha has since stopped paying the interest he promised to cover, leaving Lee to shoulder the burden himself.

Appraiser Jo Jeong-heun said the arrangement bore the hallmarks of a well-known fraud scheme. "This is a method commonly used by jeonse scammers," he said. "They inflate the jeonse price as high as possible, then offer to cover the interest. The tenant thinks it's a great deal — the landlord is guaranteeing everything, arranging the loan, paying the interest — and moves in, only to get defrauded." The concern proved well-founded: in January, reports emerged that authorities had seized Cha's villa over his failure to pay large tax arrears, raising fears that Lee could be left unable to recover his deposit and forced to absorb the full loan.

A separate concern raised by the program is that the contracts may have been designed to drive up the property's market price ahead of a sale — a form of price manipulation. Attorney Lee Don-ho said: "If a celebrity moves in and a press release goes out, it becomes news. The celebrity just puts their name on the loan, and Cha covers the interest. It raises the suspicion that this was bait to sell the units at an inflated price."

Cha himself acknowledged in an interview with "PD Notebook" that property prices had in fact risen. "When I first priced La Nuvo at 20 billion won, everyone said I was out of my mind," he said. "But jeonse prices actually started forming from the 10 billion won range. I pushed up the surrounding market prices by a huge amount."

paq@heraldcorp.com