South Korean property developer Hyundai Development Co.-Engineering & Construction plans to bolster its retail industry footing by joining an upcoming tender for duty-free shops in Seoul, its chairman said Monday.
“We plan to establish a tourism and shopping district in Yongsan by taking part in the bid for Seoul duty-free stores this year. The Yongsan I-Park Mall is deemed as one of the best locations for a duty-free shop,” said Chung Mong-kyu, chairman of Hyundai Development.
Chung is the nephew of Chung Ju-young, who founded one of the country’s biggest conglomerates, Hyundai.
Chung said he is “sure that the company will win the bid” as Yongsan’s central location and proximity to Mount Nam, museums and hotels have strong geographic benefits. He also said Yongsan can be an alternative for city center duty-free shops that are struggling with a shortage of parking space.
Mount Nam is only minutes away from Seoul’s shopping mecca, Myeongdong, which was picked by Chinese and Japanese tourists last year as their favorite place to shop.
If Hyundai Development wins the bid, the company said it will spend 100 billion won ($92 million) to turn some 8,500 square feet of the Yongsan I-Park Mall into a duty-free shopping venue.
Seoul is expected to open a bid for two duty-free stores in the capital for the first time in 15 years in line with a sharp rise in the number of Chinese shoppers, who have emerged as key customers for local retailers.
There are six duty-free stores in Seoul. Half of them are operated by retail conglomerate Lotte, while the other three are operated by Shilla, Donghwa and Walkerhill.
Despite lackluster domestic demand, duty-free shops have posted a sharp growth in recent years as a growing number of Chinese shoppers spent more during their visits to the country.
The duty-free market for foreigners is expected to reach 4.8 trillion won this year, up from 3.7 trillion won last year, according to a report by Meritz Securities Co. By 2016, the figure is forecast to hit 6.1 trillion won. (Yonhap)
