As more foreign tourists visit, major domestic and international distribution, fashion, and beauty corporations are gathering again in the Myeong-dong commercial district in Seoul. After leaving Myeong-dong for a time, Uniqlo returned after five years with the largest store in Korea, followed by large openings from Musinsa and Laneige. Lotte and Shinsegae department stores strengthened K-fashion and luxury product categories, respectively, through main store renewals in Myeong-dong.
As foreign spending increases and the vacancy rate quickly falls, signaling a recovery in the Myeong-dong commercial district, competition to open new locations among retailers is heating up again.
According to the retail industry on the 15th, Uniqlo opened the "Global Flagship Store Myeong-dong" in Jung-gu, Seoul, on the 22nd of last month. It has been five years since Uniqlo reopened a large store in Myeong-dong, after closing the Myeong-dong Jungang branch in 2021.
The new location has been built as the largest among Uniqlo stores in Korea. As a global SPA (specialty retailer of private label apparel) brand that left Myeong-dong due to COVID-19 and a boycott of Japanese products has reopened a key store, it is seen as a symbolic example of the recovery of the Myeong-dong commercial district.
Musinsa opened "Musinsa Store Myeong-dong" in January, bringing together Korean fashion brands in one place. More than 80% of the roughly 110 brands are Korean, allowing foreign tourists to browse K-fashion all in one spot.
From January to May this year, foreigners accounted for 56% of sales at Musinsa Standard Myeong-dong, and foreigners made up 65% of sales at Musinsa Store Myeong-dong. In the third quarter this year, Musinsa plans to open "Myeong-dong Jungang," the second Musinsa Standard store in Myeong-dong, expanding to three stores in the area.
Beauty corporations are also making Myeong-dong a key hub to meet global customers. Amorepacific's Laneige opened its global flagship "Laneige Seoul" in Myeong-dong on the 5th. The plan is to use the space to showcase the brand's beauty, technology, and design to customers around the world.
CJ Olive Young also opened "Central Myeong-dong Town," a large store targeting foreign tourists, in March. With the existing Myeong-dong Town store established as a representative K-beauty shopping course for foreign visitors, the company aims to capture growing inbound demand by adding a large store in Myeong-dong.
Lotte Department Store and Shinsegae Department Store, both headquartered in Myeong-dong, are accelerating store reorganization in step with the recovery of the commercial district. In July last year, Lotte Department Store opened "Kinetic Ground," a 1,800-square-meter K-fashion specialty hall, on the 9th floor of its Sogong-dong main store. Fifteen Korean fashion brands popular with foreigners, including Mardi Mercredi, Matin Kim, The Barnnet, and NONA9ON, have moved in.
Shinsegae Department Store strengthened the main store's luxury product lineup and experiential content. From the first quarter of last year to the first quarter of this year, it successively refreshed major luxury, jewelry, and watch brand stores, including Hermès, Louis Vuitton, Chanel, Cartier, Van Cleef & Arpels, Tiffany, and Rolex. At the giant outdoor screen "Shinsegae Square" in front of the main store, K-pop videos and seasonal media content are drawing in foreign tourists.
The renewal effect at department stores is also showing up in results. In the first quarter this year, foreign sales at Lotte Department Store's main store and Shinsegae Department Store's main store rose 103% and 141%, respectively, from a year earlier.
While the areas visited by foreign tourists are diversifying, Myeong-dong still holds its status as Korea's representative tourist destination. According to a March survey of foreigners visiting Seoul by the Seoul Tourism Organization, 73.4% of respondents said they visited Myeong-dong. That was the highest share among major tourist spots in Seoul.
Sales in the commercial district are also rising quickly. According to global real estate services corporation Cushman & Wakefield Korea, monthly sales in the Myeong-dong commercial district in March increased 33% from a year earlier. The growth rate was the highest among major Seoul commercial districts, including Hongdae (19%), Seongsu (11%), and Gangnam Station (8%). Annual foreign visitors to Myeong-dong totaled 14.27 million, far exceeding Hongdae (6.46 million) and Seongsu (5.4 million).
Vacancies in Myeong-dong's commercial buildings, which once exceeded half, have mostly been resolved. According to the Korea Real Estate Board (REB), the vacancy rate of medium and large commercial properties in Myeong-dong fell from 50.1% in the fourth quarter of 2021, at the height of COVID-19, to 5.0% in the first quarter this year. In four years and three months, it dropped to one-tenth the level.
A retail industry official said, "Myeong-dong still has strengths in attracting tourists for shopping purposes because transportation, lodging, duty-free shops, department stores, and road shops are all clustered in one place," and "as the number of foreign tourists and spending continues to grow, competition among corporations to open global flagship or experiential stores in Myeong-dong will continue."