ANN/THE KOREA HERALD – Lotte, Shinsegae and Hyundai, the three retail giants in South Korea, are scrambling to be the first to build a new mega shopping complex in the southwestern city of Gwangju, one of the key campaign pledges of President Yoon Suk-yeol aimed at facilitating the local economy.
Hyundai Department Store announced that it is in talks with Humans Holdings, a local real estate developer, to open a mega shopping mall in Gwangju.
The proposed construction site is a 310,000-square-metre parcel of land in Buk-gu, which was used as a textile factory until 2020 when Human Holdings bought out the property for KRW685 billion (USD529 million).
Hyundai Department Store said it will embark on the construction project soon after it receives a green light from Gwangju City.
The mega mall, tentatively called the Hyundai Gwangju, aims to become a cultural landmark, as well as a shopping and leisure destination, like the Hyundai Seoul in Yeouido. If the project goes as planned, it will be the first mega mall in the city.
Following Hyundai’s lead, Shinsegae Group also appears to be considering building a shopping complex in Gwangju after its first failed attempt in 2015. At the time, the group had planned to build a mega shopping mall and luxury hotel there but scrapped the plans due to resistance from small businesses nearby.
Since then, Shinsegae has maintained a low profile in its business expansion but more recently it is reportedly showing renewed interest in the city where its retail rivals are flocking to cater to the growing consumer demand.
Lotte Group is no exception. Sources said Lotte is also reviewing potential sites for a new shopping mall in Gwangju. Among the three retail giants, Lotte operates the largest number of shopping outlets there, including a Lotte Department Store, a Lotte Outlet and four Lotte Mart stores.
Gwangju, with a population of 1.5 million, is one of the biggest cities, but residents have long complained about a lack of infrastructure for shopping. During his presidential campaign in February, Yoon had pledged to build a new mega shopping mall in the city.
Data shows that Gwangju residents are also willing to open their wallets and spend.
According to data from Gwangju Shinsegae Department Store, its customers spent over KRW100 billion in Shinsegae Department Stores in other regions. In particular, customers from Gwangju and South Jeolla Province spent over KRW5 billion in Daejeon Shinsegae in August last year following the new opening.
Despite the rosy outlook, the three retail giants have several hurdles ahead, with the first and foremost being getting approval from the Gwangju city.
Gwangju Mayor Kang Gi-jung said during a transition committee meeting that no retail group has formally made an offer yet.
“The city will set the guidelines for the new mega mall. If the Hyundai Gwangju suits our idea of the mall, it could be the one (to start business here),” Kang said, adding that the city has not yet decided on the total number of malls that could be constructed.
