Hanwha Galleria bids for duty free

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Hanwha Galleria bids for duty free

Hanwha Galleria is joining the competition for Seoul duty-free licenses with plans to open a duty-free shop at the 63 Building in Yeoeuido, the company said on Thursday. The 63 Building, a 250 meter landmark in Seoul and one of the most popular shopping-to-entertainment arenas in Korea, is owned by Hanwha Life.

It houses an aquarium, a wax museum, a performance hall, and restaurants. It also has an art gallery and an observatory on the 60th floor with an unobstructed view of Seoul and the Han River.

It draws 3.2 million visitors per year and about 7,000 tourists per day, 9 percent of whom are foreign, according to the company. The skyscraper is featured in the latest Avengers movie, and its golden color has attracted many Chinese tourists, who go for all things gold.

The company has plans to refurbish its popular aquarium, and is planning a duty-free shop with an open view of the river.

The 63 Building is close to the Conrad and Marriot hotels, the Han River park and IFC Mall. It is also closer to both Incheon and Gimpo airports, two main gateways to Korea, than most other parts of Seoul.

Hanwha’s announcement follows news earlier this week that Shinsegae will set up a new company as it prepares to bid for a Seoul duty-free license by a deadline in June.

Three licenses to open and operate duty-free shops in Seoul are scheduled to be issued by the Korea Customs Service in July.

Amid a prolonged slump in domestic consumer demand, retail companies are scrambling to find new sources of profit. The duty-free industry, with its double-digit sales growths thanks to Chinese tourists, has sparked retail giants’ interests.

According to Korea Customs Service data, Korea’s duty-free market was worth 8 trillion won last year compared with 4.8 trillion won in 2010.

Besides Hanwha and Shinsegae, major Korean conglomerates including a Hotel Shilla-Hyundai Development joint venture, Lotte Duty Free and Hyundai Department Store have joined the race for the Seoul licenses.

There are six duty-free shops in Seoul, three operated by Lotte, and individual stores by Hotel Shilla, SK Networks’ Walkerhill and Dongwha.

Hanwha Galleria opened a duty-free shop at Jeju airport last June.

Due to a lackluster performance by its department stores, Hanwha Galleria’s sales for 2014 fell 24 percent year-on-year to 2.05 trillion won.

BY PARK JUNG-YOUN [park.jungyoun@joongang.co.kr]
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