Executive at AIG’s real estate arm confident about project’s success


An exceptional shopping mall opened in Seoul’s Yeouido area last week, targeting fans of global clothing stores such as Massimo Dutti, Zara, H&M and Uniqlo.

The three-story underground mall lies beneath the International Finance Center complex which is comprised of three office buildings ― the 32-story One IFC, the 29-story Two IFC, the 55-story Three IFC ― and the 38-story Conrad Hotel.

It took nine years to complete the IFC Seoul project, in which Vivian Ahn, vice president of AIG Korean Retail Estate Development, played a key role.

“The IFC Mall is for people in their 20s and 30s who like SPA brands and a pleasant indoor shopping environment where entertainment and dining are also available,” Ahn said in an interview with The Korea Herald. SPA brands refer to specialty store retailers of private-label apparel, which produce their own clothing and distribute them to cut costs.

“It is directly connected to the Yeouido Subway Station where subway lines No. 5 and 9 intersect, offering convenient access from both Gangnam and Gangbuk (south and north of the Han River).”

Until now, Myeong-dong was the only place in Seoul with all the top SPA brand stores. But shoppers who found it tiresome to trot around the nation’s most crowded shopping district in the rain or snow could prefer the relatively compact IFC Mall, where popular fashion brands such as Hollister, Banana Republic and Mango are also clustered together under the same roof.

Ahn joined the Korean arm of AIG Real Estate Development in 2005 as its first staff member, two years after the IFC Seoul project was hatched and a year after a memorandum of agreement was inked between the Seoul City government and AIG.

She talked a number of companies, such as Deloitte Korea, into moving into IFC One, which opened late last year. Other tenants of IFC One include ING Asset Management, Sony, LG Hausys, Japan’s Daiwa Securities, China’s Zhaoshang Bank and New York Mellon Bank. 

“We were the first in Korea to introduce a pre-leasing system which is widely used in advanced countries,” Ahn said as she explained how it took two years for her to get Deloitte to sign a pre-leasing contract in 2009 to use nine floors.

“It was hard to get contracts after the collapse of Lehman Brothers, but once we got Deloitte, other companies began to show interest.”

In fact, property prices around IFC Seoul jumped as its opening neared.

Some real estate market watchers expect the value of the Shinhan Investment Corp. building and site, just across the street from IFC Seoul, to surge by nearly 10 billion won as the IFC Mall’s restaurants, theater and bookstore as well as the Conrad Hotel, slated to open in November, drive up the commercial value of the area.

“Before picking stores for IFC Mall, we did a survey of people living in Yeouido and Mapo on what amenities they want the most. A theater was the No. 1 answer and the second was a bookstore,” Ahn said.

“In addition to serving the needs of some 238,000 people who work on the island and 34,000 residents, we are confident the IFC Seoul will be a landmark of the city that is a must-go place for tourists.”

Once tenants move into the IFC Two and Three in November, nearly 25,000 people will come to work at the IFC Seoul everyday.

The mall’s opening last Thursday was a success as thousands flocked to check out the new interior designed by Benoy, the same award-winning company that designed Singapore’s ION Orchard and Hong Kong’s Elements.

Whereas department stores here take about 30 percent of the brand stores’ revenue in commissions and relocate stores with low sales twice a year, IFC Mall receives fixed rents and commissions for only sales above targets.

The contract periods range from three to five years in contrast to one year at other shopping malls.

James Tyrrell, office leasing director of IFC Seoul, was optimistic about the demand for commercial real estate in Korea despite the falling prices and transactions of residential property.

“In spite of the economic slowdown, a lot of investors in Korea are investing in real estate. For instance, about 10 companies competed to buy the Hewlett Packard building in Yeouido recently,” he said.

“Since a number of large buildings with offices and retail functions are scheduled to be built in Korea, it seems to be an opportune time for companies to move into new buildings as greater competition would result in more benefits for tenants.”

By Kim So-hyun (sophie@heraldcorp.com)