[Interview] "Vertical Stacking of Spaces Is a Commercial Real Estate Trend... Envisioning Dedicated Space for 'K-Brands'"

Yoon Hwasub, Executive Director at Cushman & Wakefield Korea
Scrapped mall plan and filled six floors with clinics to tap medical tourism

"We put an Apple Store on the first and second floors of a building in Myeongdong and a hotel on the upper floors, but the floors caught in between, from the third to the eighth, were a challenge. We considered turning them into a shopping mall with clothing stores and restaurants, but wondered, 'Would that really do enough business, no matter how well we put it together?' So we filled the floors with dermatology and dental clinics. Demand took off as foreign visitors booked hotel rooms, rode the elevator down, and got treatments."

Yoon Hwaseop, managing director and head of the Retail Leasing Group at Cushman & Wakefield Korea, spoke on the 27th at the Seoul Finance Center in Gwanghwamun, Seoul. He pointed to combining different types of businesses in one building as a way to eliminate vacancies in commercial buildings and increase their value. "These days, building owners ask more than anything which types of businesses they should combine to create synergies, rather than filling a building with just one type," he said.

Yoon Hwaseop, Head of the Retail Leasing Group at Cushman & Wakefield Korea. Cushman & Wakefield Korea

Yoon entered the real estate industry in 2001 and worked as a store development manager for GS Watsons at GS Retail before joining Cushman & Wakefield Korea in 2012. He has played a role in tenant mix planning for major commercial properties, including the largest Apple Store in Korea in Myeongdong, Avenue France in Pangyo, D Tower in Gwanghwamun, and M Plaza in Myeongdong.

Four years ago, while advising on Myeongdong Hyde Park Building, Yoon brought together a corporate hospital group from Gangnam seeking to expand into northern Seoul and existing hospitals looking for new premises in Myeongdong, filling six floors in the middle of the building. The plan to place hospitals below a hotel matched the surge in demand from foreign tourists. The cumulative number of visitors to Korea from January through September this year reached 17.11 million, up 21.5% from the same period a year earlier, and monthly arrivals exceeded 2 million on five occasions.

"Medical tourists typically spend several million won on treatments, while even ordinary tourists get laser treatments costing hundreds of thousands of won before they leave," Yoon said. "For the same amount of space, hospitals pay more rent per 3.3 square meters than ordinary offices do, so building owners prefer hospitals to offices." Since Cushman & Wakefield Korea formed the industry's first medical team in 2022, it has completed 68 hospital leasing deals, covering a total area of 41,256 square meters.

He is also developing plans for a dedicated space for "K-brands," with fashion, cosmetics, clinics, and pharmacies arranged vertically in one building to gather sales data by nationality and pave the way for overseas expansion. The idea is to bring brands proven in Korea together in one building to attract foreign tourists and use sales data by nationality gathered there to help those brands expand overseas.

However, Yoon stressed that "you can't just combine different types of businesses in any location and expect it to work." For a mix of businesses to succeed, he said, it is essential to identify precisely who the core consumers are. Even if businesses are combined, or a building is filled with businesses of the same type, the plan can fail if the surrounding consumer base is misjudged. "Commercial properties succeed when they maximize the overlap between what building owners, tenants, and consumers want," he said. "After going through countless trials and errors, we've now established criteria for what to look at first."

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