Shinsegae’s online logistics center delayed by residents

Korean retail giant Shinsegae said Friday that it has postponed signing a land contract to build a logistics center for its online business due to protests from local residents in a setback to its plan to strengthen its e-commerce business.

Shinsegae had planned to ink the 97.2 billion won ($91.6 million) contract with the Korea Land & Housing to buy a 21,422-square-meter (230,584-square-feet) plot of land in the city of Hanam, just southeast of Seoul, earlier in the day.

“We are not withholding or suspending our plan but have decided to raise the residents’ understanding of our project and proceed based on their consent,” a company official said.

The local residents have voiced concerns over possible traffic congestion and pollution, as well as other safety issues that could follow the construction of the new center.

Adding to Shinsegae’s woes, the mayor of Hanam has said that he will not approve the construction without the consent of the residents.

Shinsegae has said that the new center will serve as not just be a logistics center but a headquarters for the group’s online business.

The retailer’s move underscored the growing need to make most of a dramatic rise of purchases made over the Internet and smartphones in a country where about seven out of 10 South Koreans are known to own a smartphone.

Yonhap