Hyundai Department Store Announces 60 Billion KRW Investment
New Corporation The Hyundai Gwangju to be Established This Month
Shinsegae Property Plans Corporation Establishment Next Month
Distribution companies are accelerating the construction of a complex shopping mall in Gwangju Metropolitan City. Hyundai Department Store established the 'The Hyundai Gwangju' corporation this month and has officially started the construction of the complex shopping mall. Emart also plans to complete the establishment of the 'Grand Starfield Gwangju' corporation by next month, signaling the intensification of competition among domestic retail giants surrounding the Gwangju commercial district.
According to the Financial Supervisory Service's electronic disclosure system on the 8th, Hyundai Department Store announced the investment report for establishing 'The Hyundai Gwangju' the day before. The total investment amount is 60 billion KRW, with 30 billion KRW reported in this investment notification. Hyundai Department Store plans to newly establish 'The Hyundai Gwangju' corporation within this month and invest on the 26th of next month.
The '2024 Policy Topic-specific Work Report Meeting' held on the 1st at Gwangju Silgam Content Cube (GCC) in Nam-gu, Gwangju Metropolitan City. / Photo by Gwangju Metropolitan City
Hyundai Department Store plans to build 'The Hyundai Gwangju,' the largest in Korea, on approximately 310,000㎡ of the former Jeonnam Textile and Ilsin Textile sites. The project cost is expected to be 1.2 trillion KRW.
Until now, negotiations on public contributions have been the biggest challenge in constructing the complex shopping mall. Previously, Gwangju City and Hyundai Department Store finalized the public contribution rate at 54.4% through the 11th negotiation adjustment meeting in November last year to secure the public contribution portion. The public contribution amount was decided to be 589.9 billion KRW, which is 54.4% of the land value increase of 1.0835 trillion KRW in the area.
With the conclusion of negotiations with Gwangju City and the promotion of corporation establishment, the construction of 'The Hyundai Gwangju' is expected to gain momentum. Gwangju City plans to initiate the district unit plan establishment procedure in the first half of this year. 'The Hyundai Gwangju' aims to start construction in the first half of 2025 and complete it by the end of 2027.
Another complex shopping mall site, Eodeungsan Tourist Complex, is gaining momentum in the construction of 'Grand Starfield Gwangju' as Shinsegae Property recently paid the agreement performance deposit. Shinsegae Property submitted a guarantee insurance certificate worth 11.6 billion KRW to Gwangju Urban Corporation last month and paid 8.6 billion KRW, which is 10% of the land price, as a deposit in the same month.
Shinsegae Property signed the 'Eodeungsan Tourist Complex Development Agreement' with Gwangju Urban Corporation on December 22 last year, agreeing to pay a performance deposit of 63.5 billion KRW in stages before construction and to prioritize paying 24 billion KRW, including the deposit, out of the 86 billion KRW land price by this year. Additionally, since the corporation must be established within 90 days, they plan to fulfill this by the 21st of next month.
'Grand Starfield Gwangju' is a development project by Shinsegae Property to create the Starfield complex shopping mall on approximately 417,000㎡ of land in Eodeungsan, Gwangju City, with a total project cost of 1.3 trillion KRW. The development project will go through administrative procedures such as basic plan establishment, detailed design, and modification of development plans, with preliminary preparations in the second half of 2025, followed by site development and infrastructure construction. Infrastructure such as roads and rivers (Phase 1) and Starfield and condos (Phase 2) are planned to be completed by 2030, and residences and auxiliary facilities (Phase 3) by 2033.
Gwangju City is also actively cooperating in the construction of the complex shopping malls. Mayor Kang Ki-jung of Gwangju said at the complex shopping mall administrative briefing early this month, "Gwangju's complex shopping mall is not just a simple shopping mall construction project but an investment attraction where large corporations see Gwangju's potential and invest over 4 trillion KRW in tourism, distribution, and cultural industries," adding, "This year, we will provide prompt administrative support for the complex shopping malls and draw up plans for coexistence with small business owners and traffic measures."
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