Stores Near Large Commercial Districts Continue to Sell Out, Expecting Synergy Effects

Recently, as the self-employed sector has been hit by various factors, investors are increasingly focusing on the so-called 'sorting the wheat from the chaff' for superior commercial facilities. As a result, commercial properties located near large commercial districts are receiving high marks.

According to the Financial Stability Report released by the Bank of Korea in December last year, as of the end of September last year, the scale of loans to the self-employed reached 777.4 trillion won, a 15.9% increase compared to the same period the previous year. By industry, loans increased significantly particularly in wholesale and retail, food service, and leisure services. Due to the prolonged COVID-19 pandemic and the rise of non-face-to-face transactions, sales have sharply declined mainly among self-employed workers in face-to-face business sectors, and it is reported that they supplemented this by raising funds through loans.

Amid growing demand for commercial facilities with excellent locations that can ensure income stability, new commercial properties adjacent to large commercial districts have recently been launched in the sales market, achieving outstanding results. These properties attract investors' attention because their locations are advantageous for attracting foot traffic through linkage with large commercial districts.

Earlier this January, the commercial facility 'Hills Avenue Cheonggye Central' within 'Hillstate Cheonggye Central' (scheduled for occupancy in May 2024) was sold out within a month of contract signing. Located in the heart of Hwanghak-dong’s kitchen and furniture street, designated as a specialized street, it is expected to establish itself as a kitchenware-specialized commercial facility. According to Jung-gu (as of July), there are 365 stores related to kitchen and furniture goods in this area, and including manufacturing and other stores, the total reaches as many as 540. Additionally, it is situated in connection with the already active Seoul Central Market commercial district, naturally attracting foot traffic that uses the existing commercial district.

In A86 Block of Dongtan 2 New Town, Hwaseong, Gyeonggi Province, the commercial facilities (8 units) within the 'Lake Jayeon & Prugio' apartment complex (occupied since March 2020) recorded a highest bid rate of 168%, with all units sold on the day of sale. Located on the southern side of Dongtan 2 New Town, known as 'Namdongtan,' it is close to the core commercial district of Dongtan Lake Park, allowing for the inflow of demand from large residential complexes and the lake park commercial district. This commercial district includes several facilities such as the large-scale French-themed complex shopping mall Grand Passage.

In the provinces as well, commercial facilities near large commercial districts are being rapidly occupied. The commercial facilities within 'Duryu Centreville The City' in Dalseo-gu, Daegu (scheduled for occupancy in December 2022) also succeeded in completing contracts in a short period. This complex is expected to see significant population inflow as the Daegu New City Hall is scheduled to relocate nearby in 2025, and it is adjacent to Duryu Youth Street, allowing linkage with existing commercial districts.

An industry insider said, "When new commercial facilities are sold near large commercial districts, they can benefit from the expansion effect of already popular large commercial districts, increasing the likelihood of population inflow and thus offering income stability. As demanders interested in commercial property investment carefully scrutinize commercial facility conditions due to the impact of COVID-19, cases of quick demanders rapidly occupying commercial properties in such locations continue to emerge."

Hyundai Engineering & Construction plans to simultaneously sell the commercial facility 'Hills Avenue Jang-an Central' within the residential officetel 'Hillstate Jang-an Central' in the Dongdaemun-gu area of Seoul in April. It consists of a total of 85 stores from basement level 1 to the 2nd floor.

This commercial facility will be located in the already active central commercial district of Dongdaemun-gu. Around the Jang-an-dong intersection, residential complex commercial districts, officetel commercial districts, and food streets have been established. In particular, it is expected to be located in connection with the 'Jang-an-dong Food Street,' naturally attracting foot traffic from the existing commercial district.

It also has a residential demand base of more than 12,000 households in Jang-an-dong. It secures fixed demand from residents within the complex and has abundant hinterland demand including many villas, houses, and large apartment complexes such as Jang-an Hyundai Hometown Phase 1 (2,182 households), Jang-an Samsung Raemian Phase 2 (1,786 households), Jang-an Hillstate (859 households), and Jang-an Samsung Raemian Phase 1 (558 households).

To maximize the inflow of foot traffic aiming to use Janghanpyeong Station and the central commercial district, it is designed as an open-type commercial facility along a main road. The 1st and 2nd floors feature an open-themed design extending from the main entrance at the front to the plaza at the rear, optimized for pedestrian flow.

This content was produced with the assistance of AI translation services.