Lotte Shopping is reportedly considering closing the Lotte Mart World Tower store in Jamsil, Songpa District, Seoul, and replacing the space with a food and beverage (F&B) establishment. This approach aims to attract popular tenants while simultaneously generating stable rental revenue.

According to the retail industry on the 26th, Lotte Shopping is said to be reviewing a plan to replace the Lotte Mart World Tower store, located in the basement of Lotte World Mall, with a food and beverage establishment or a pop-up content space.

The Christmas market set up at the arena grassy plaza in front of Lotte World Mall in Jamsil, Songpa District, Seoul is crowded with citizens. /Courtesy of News1

Lotte officials predict that the combined revenue of Lotte Department Store Jamsil and Lotte World Mall will exceed 3 trillion won this year. If realized, this would make it the second store in the country to join the 3 trillion club, following Shinsegae Department Store in Gangnam, Seoul. It has surpassed the sales of the main store in Sogong-dong, making it Lotte’s flagship store.

The Lotte Mart World Tower store opened simultaneously with the Lotte World Mall on October 14, 2014. However, there is another Lotte Mart Zeta Plex store located 10 minutes away on foot (about 700 meters). This overlap in customer demand has led to considerations of streamlining the store's operations.

An industry insider noted, "Currently, Lotte Department Store Jamsil is benefiting significantly from pop-ups and content attractions," adding, "We are considering attracting even more 'hot' venues to leverage these strengths."

Recently, large retail companies have been increasing the proportion of tenants. This is due to various advantages such as rental revenue, customer attraction, and strengthening shopping mall competitiveness. In particular, offline shopping malls are transforming into complex cultural spaces that offer diverse experiences rather than just shopping, leading to a trend of increasing the tenant proportion in food and beverage.

Moreover, having tenants instead of directly operating stores provides more stable revenue. Even during economic downturns, rental income tends to remain at a certain level.

A representative example of expanding the tenant share is Shinsegae E-Mart. Recently, E-Mart has been increasing the tenant share in its renovated stores. At E-Mart Town Wolgye, the store's composition changed from 80% E-Mart and 20% tenant to 30% E-Mart and 70% tenant after the renovation.

E-Mart Town Kintex has also reopened as 'The Town Mall Kintex' after a significant renovation lasting seven months. This is E-Mart's largest store, covering 26,446 square meters (about 8,000 pyeong). It combines specialty stores like Traders and No Brand with a large experiential mall.

In this regard, a Lotte Shopping official stated, "Currently, there are no plans to withdraw from the Lotte Mart World Tower store," adding, "We are considering renewing the mart to attract customers, especially since a large apartment complex nearby has completed redevelopment and residents are expected to move in soon."