With Social Distancing Becoming Routine, 'Dongnae Sangkwon' Gains Popularity!

- Most consumption activities took place near residences during the prolonged COVID-19 period
- ‘Asan Sambur Renaissance The Hill’ neighborhood commercial area with strong local demand

The prolonged COVID-19 pandemic is driving changes in the real estate investment market. As psychological burdens related to staying outdoors for long periods or moving to multiple locations increase, 'Home-around' consumption has emerged as a new trend.

In line with this trend, commercial property investors are turning their attention from large commercial districts with heavy foot traffic, such as Myeongdong and Hongdae, to neighborhood commercial areas densely populated with residential facilities.

The popularity of neighborhood commercial areas is also confirmed by the numbers.

According to the investment yield of medium-to-large commercial properties in the first quarter of this year compiled by the Korea Real Estate Board, the average investment yield in Seoul's Sanggye Station area, which is densely populated with residential zones, was 2.31%. This figure significantly exceeds the overall average investment yield of 1.81% in Seoul.

On the other hand, Myeongdong, considered a representative commercial district in Seoul, recorded an investment yield of 0.2% in the first quarter of this year. This is the lowest yield among 57 districts in Seoul. Other large commercial districts that were once popular, such as Dongdaemun (1.54%), Jongno (1.64%), and Hongdae (1.79%), also recorded yields lower than the Seoul average, drawing attention.

A real estate expert explained, “As aversion to face-to-face contact increases, most consumption activities are taking place near people's homes rather than in famous commercial districts crowded with many people.” He added, “Commercial areas formed in places densely populated with residential facilities have solid demand in the background, making them popular for stable investment returns.”

Meanwhile, new commercial facilities are attracting investor interest in Sinchang District, Asan City, Chungnam Province, where a residential town of about 10,000 households has been formed.

On June 15, Sambutogeon will conduct a bidding for commercial spaces within the ‘Asan Samburenaissance The Hill’ complex. This commercial facility consists of 17 units on the first floor within the landmark large-scale complex ‘Asan Samburenaissance The Hill,’ which is being built with a total of 1,016 households.

Designed as a street-type commercial area along a main road with excellent visibility and accessibility, it will be composed of lifestyle-oriented MDs such as cafes, bakeries, and laundries frequently visited by residents.

The commercial facilities within the ‘Asan Samburenaissance The Hill’ complex have the advantage of being located in a prime spot within Sinchang District, where residential complexes are densely concentrated. Currently, a residential town of about 10,000 households has been formed in Sinchang District, and fixed demand is secured by residents of the already successfully sold ‘Asan Samburenaissance The Hill.’

There are also major development benefits. The Asan Sinchang General Industrial Complex, covering 642,000㎡ in Omok-ri and Gung-hwa-ri, Sinchang-myeon, is scheduled for completion in 2024, and the Inju General Industrial Complex Section 3 in Inju-myeon is accelerating development, also expected in 2024. Once completed, the floating population is expected to increase further.

A sales official said, “Sinchang District is transforming into a new residential town representing the western part of Asan, with over 10,000 apartments already occupied and large-scale apartment supplies continuing.” He added, “Despite strong residential demand, the ratio of commercial facilities in the area is low, so investor interest in this new commercial facility supply is very high,” describing the on-site atmosphere.

This commercial facility, supplied as neighborhood stores within the ‘Asan Samburenaissance The Hill’ complex, which is being built with a total of 1,016 households in Asan City, Chungnam Province, will be offered through a public competitive bidding method on Tuesday, June 15.

The bidding will take place from 10 a.m. to 2 p.m. on June 15, with a bid deposit of 5 million KRW per store. The successful bidders will be announced on the day of the bidding, and contracts will be signed the following day, Wednesday, June 16. The expected move-in date is October 2023.