Hyundai Department Store Group announced on Friday its plan to set up an urban duty-free store within its most lucrative department store in Samseong-dong, an affluent district in southern Seoul, if it wins a business license in June.

This is the first time that the retail giant has mentioned a location for its first duty-free store.

The company will also establish an affiliate to look over the duty-free operations, hinting at expanding its business in this sector.

“The firm’s building is situated right next to Coex,” the company stated. 

The Coex area is considered a prime area to lure individual and business tourists in southern Seoul as it houses not only a department store but also other entertainment and tourism facilities ― including a shopping mall, city airport terminal and premium hotels.

More diversified outdoor marketing activities are allowed as the area has recently been designated a tourist district for meetings, conferences and exhibitions.

Hyundai will be competing for three urban duty-free slots newly allocated in Seoul. The Korea Customs Service will open the bid in June.

Some of its biggest rivals are Lotte, Hotel Shilla and Walkerhill by SK, which are also planning to expand their duty-free presence.

Business enterprises Shinsegae, Hyundai Development Co. and The Galleria by Hanwha, which have all entered the market relatively recently, have also expressed their intention to join the bidding.

Korea’s urban duty-free market is estimated at around 3.2 trillion won ($2.9 billion), thanks to the tourist influx, mainly from China.

By Bae Ji-sook  baejisook@heraldcorp.com)