The Coex Mall, Asia’s largest underground shopping center located in Gangnam, southern Seoul, is facing criticism that its ambitious 300 billion won ($250 million) renewal has led to excessive rent fees and massive sales drops.
Of the 240 stores, up to 20 shops, including Giordano, Coffee Smith and shoemaker Landrover, reportedly pulled out from Coex less than a year after the mall reopened last November.
Store owners in the building claim their sales reached only one-third of the initially expected figures, and less than half the sales they enjoyed before the renewal.
|Coex Mall Yonhap|
The Korea International Trade Association, which operates the Coex Mall, says “The sales did decline earlier this year, but it appears to be bouncing back.”
The Coex Mall first launched in 2000 and received the spotlight as the most popular multiplex shopping mall in the country. As the facilities aged and the number of competitors rose, it injected 300 billion won in March 2013 to begin refurbishing the building and reorganizing brands, from low- to mid-budget brands to foreign brands like Burberry Beauty Box and Versace Jeans.
Following the renewal project, the mall was expanded to 154,000 square meters from the previous 122,000 square meters.
A union of business operators in the building said they voted for the refurbishing plan after KITA persuaded them that business would flourish with the makeover.
However, the union says the floating population was less than half of what the mall operator had expected, 130,000 people, and the white interior design made visitors confused with directions.
Moreover, the union believes the target consumers should have been teenagers and those in their 20s like in the past, but KITA called in expensive brands, only to see the number of visitors and sales drop.
“Some stores had a very few number of visitors, as low as 10 people a day,” the union told local media.
The KITA officials refute the accusations, citing seasonal variation for low sales and the limitations of a large single-story mall.
“Because Coex is a single-story mall, it’s difficult to keep visitors’ movement to a minimum and classify stores based on the types of merchandising items, like department stores,” a KITA official said.
“But we are aware of some inconveniences and are planning to make up for the problems by setting up signs to help people find their way,” he said.
By Suk Gee-hyun (firstname.lastname@example.org)