[Report] "Lotte Signs Everywhere" Vietnam as Overseas Forward Base's Aggressive Investment

65-Story 'Lotte Center Hanoi' Regional Landmark
Weekend Early Hours See Crowds at Department Store and Mart
Next Year, Hanoi's Largest Complex Shopping Mall 'Lotte Mall Hanoi' to Open
Vietnam, Starting with Lotteria in 1998, 19 Affiliates Enter as Global Hub
12 Trillion KRW Ho Chi Minh 'Eco Smart City Project' to Begin Construction This Year

Visitors are shopping at Lotte Mart inside Lotte Center Hanoi in Hanoi, Vietnam.

[Hanoi=Asia Economy Reporter Kim Yuri] Hanoi, the capital of Vietnam. Between the Bading-gu Liu Zai and Daoden areas, the 'Lotte Center Hanoi,' towering 65 floors high, saw a line of visitors from early on the weekend. Entering through the entrance adorned with lavish Christmas decorations, the sight of a department store housing global beauty brands, restaurants, and cafes comes into view. Taking the escalator down one floor, the place was packed with locals shopping for groceries and tourists buying souvenirs. At the 'Side Dish' corner, staff wearing sanitary hats, gloves, and masks were preparing food on the spot. The in-house delivery service booth 'Speed L' at the entrance was also bustling. Grab delivery drivers were busy coming and going. This super high-rise complex building, with a site area of 14,000㎡ (about 4,200 pyeong) and a total floor area of 253,000㎡ (about 76,000 pyeong), housing a department store, mart, hotel, residence, and offices, has become a regional landmark since its completion in 2014. Next year, 'Lotte Mall Hanoi' will open on a site more than five times larger, about 5 km away near West Lake in Hanoi.

Entrance of Lotte Department Store inside Lotte Center Hanoi in Hanoi, Vietnam. Customers are browsing products.

◆Lotte Strengthens Its New 'Overseas Forward Base' in Vietnam

Vietnam currently serves as a global hub with 19 affiliates within the group operating department stores, marts, hotels, duty-free shops, and trading companies. As Southeast Asia's importance grows as an overseas market replacing China, the Vietnamese market is being developed as a strategic stronghold.

Lotte has designated Vietnam as a key overseas market and is expanding aggressive investments. The leadership baton is held directly by Lotte Chairman Shin Dong-bin. After the special pardon on Liberation Day, Chairman Shin was the first to visit Vietnam. At the meeting with Nguyen Xuan Phuc, President of Vietnam, Lotte Group's distribution division head Kim Sang-hyun, hotel division head Ahn Se-jin, Lotte Department Store CEO Jung Joon-ho, and Lotte Mart CEO Kang Sung-hyun all attended. They also accompanied the groundbreaking ceremony for the Ho Chi Minh 'Eco Smart City Project.' This project is a large-scale complex development by Lotte at a 50,000㎡ site in the Thu Thiem new urban area of Ho Chi Minh City, consisting of super high-rise office facilities, shopping malls, commercial facilities, hotels, residences, and apartments. The total project cost reaches 1.23 trillion KRW.

◆Next Year, Hanoi's Largest Complex Shopping Mall 'Lotte Mall Hanoi' Opens

Lotte will open Lotte Mall Hanoi, a complex commercial complex including a shopping mall, mart, cinema, aquarium, offices, hotel, and residences, on a 73,000㎡ (about 22,000 pyeong) site in the Bozzi Gonggeori area near West Lake in Hanoi in the second half of next year. The total floor area will be 354,000㎡ (about 107,000 pyeong). Currently, construction progress has exceeded 50%. Interior work will be completed by April next year, with a pre-opening planned for June and a grand opening in August. The mall will attract overseas contemporary, cosmetics, and food & beverage (F&B) brands debuting for the first time in Hanoi. It will also feature a cultural center, yoga experiences, DIY workshops, and bookstores, positioning itself as a complex cultural space. West Lake, the largest lake in Hanoi known as the 'City of Water,' is a major tourist attraction frequently visited by foreign tourists. Nearby are luxury villa villages and foreign residential areas. Above all, as a new concept complex shopping mall offering diverse experiences, it is drawing great interest from the local Vietnamese 'young families.'

At the "Side Dish" corner of Lotte Mart inside "Lotte Center Hanoi" in Hanoi, Vietnam, employees are cooking on the spot.

◆Vietnam's Distribution Market Grows 100-Fold in 20 Years, Becoming a 'Top Global Brand'

In the early 2000s, Vietnam mainly had small local department stores and medium-sized shopping malls, and there was a lack of distribution facilities to meet the rapidly growing middle-class demand. In the 2010s, large-scale malls began to be built centered around major retailers like Aeon and Vincom, igniting competition in premium distribution facilities. To target the young middle class emerging as major consumers in Vietnam's distribution market, Lotte opened Lotte Department Store Hanoi in 2014. It differentiated itself with store layouts breaking the local department store mold and Korean-style services. Lotte Department Store Ho Chi Minh opened in March 2015 by acquiring 'Diamond Plaza,' the first department store in Ho Chi Minh City, and operating a total of five floors as a joint venture. Reflecting the area's characteristics of high prices and a large high-income population, it adopted a premium strategy. A major full renovation is currently underway. The size of Vietnam's distribution market has grown about 100 times compared to the early 2000s.

Lotte Mart entered the Vietnamese market in 2008 by opening the 'Nam Saigon branch' in Ho Chi Minh City, the first domestic retailer to do so, and currently operates 15 stores. The Nam Saigon branch is a complex shopping center differentiated from local large marts by significantly enhancing cultural and convenience facilities, boasting the largest scale as a single shopping center in Vietnam. In July, the 15th store was newly opened in Vinh, in north-central Vietnam. It will also open in Lotte Mall Hanoi next year. Except for the years 2020 and 2021, which were heavily affected by COVID-19, Lotte Mart's Vietnam business has seen sales growth of over 10% annually.

Starting with Lotteria in 1998, followed by Lotte Mart and Lotte Cinema in 2008, Lotte Hotel in 2013, and Lotte Department Store in 2014, Lotte has successively entered Vietnam, building a friendly image among locals and tourists visiting Vietnam and solidifying its position. A Lotte official said, "Along with the opening of Lotte Mall Hanoi next year, existing stores will also be upgraded based on each store's strengths to become Vietnam's top global distribution brand."