"If Monthly Rent Exceeds 100 Million Won, Daejeon Station Will Be Moved... Seongsimdang Issues Final Ultimatum"

"If Annual Rent is 5 Billion Won, Alternative Methods Must Be Found"
Open Competition Held but No Qualified Bidders, All Auctions Failed

Regarding the Daejeon Station branch facing the risk of eviction due to excessive monthly rent increases, Seongsimdang has stated that "it is difficult to pay more than 100 million won per month." This is the first official statement since the lease contract for the Seongsimdang store inside Daejeon Station expired. Lim Young-jin, CEO of Rosso Co., Ltd., the operator of Seongsimdang, told News1 on the 27th, "For the Daejeon Station branch, where 140 employees work, it is impossible to stay at Daejeon Station by paying rent higher than the current amount."

Seongsimdang (聖心堂), a bakery with 56 years of tradition
Photo by Asia Economy DB

CEO Lim said, "The current rent is 100 million won per month, and it is increasing more than fourfold. Can we afford that?" He added, "If we have to pay 5 billion won annually in rent, we will have no choice but to find another way." He hinted at the possibility of purchasing or leasing a building near Daejeon Station to open a new store if higher rent must be paid. He continued, "Currently, about 1,000 people work at Seongsimdang, and considering the rising costs of bread ingredients and labor, paying 5 billion won annually in rent is not financially viable."

Seongsimdang (聖心堂), a bakery with 56 years of tradition, located in the waiting room of Daejeon Station
[Photo by Asia Economy DB]

Last month, the lease contract between KORAIL Distribution, which operates commercial facilities and advertising media at train stations nationwide, and Seongsimdang expired. Until now, Seongsimdang had been paying about 100 million won in monthly rent. This accounts for approximately 4% of the Daejeon Station branch's average monthly sales (2.598 billion won). This has led to allegations of preferential treatment. According to KORAIL Distribution's internal regulations, in-house business fees should be 17-49% of average monthly sales. However, local officials commonly agree that no other company besides Seongsimdang can afford a monthly rent of 100 million won. For comparison, the monthly fee for a similar store in the second-floor waiting room at Osong Station in the Chungcheong region was about 9.2 million won.

Four rounds of public competitive bidding held for Daejeon Station store, all failed

Minister Yoo In-chon of the Ministry of Culture, Sports and Tourism is visiting the Daejeon Station branch of Seongsimdang, designated as Local 100, on the 17th and having a conversation with CEO Lim Young-jin.
[Photo by Ministry of Culture, Sports and Tourism]

KORAIL Distribution has held four rounds of public competitive bidding for the Seongsimdang Daejeon Station store, but all failed due to lack of qualified bidders. The initial bidding condition set by KORAIL Distribution was 441 million won, which is 17% of Seongsimdang’s average monthly sales of about 2.6 billion won. Seongsimdang participated in the bidding but reportedly submitted a bid lower than the minimum required amount. As a result, Seongsimdang met the non-quantitative evaluation score (out of 20 points) set by the KORAIL Distribution evaluation committee but failed to meet the quantitative evaluation score (out of 80 points), leading to the bid being rejected.

On the 27th, KORAIL Distribution announced a fifth bidding notice with a 30% reduction from the initial bid, setting the monthly sales base at 1.81867 billion won, an upper limit of 2.728 billion won, and a fee of 309.17 million won. This is the last amount KORAIL Distribution can reduce according to regulations. Seongsimdang has extended the contract for six months and will operate the store until the end of October. Currently, it seems highly likely that Seongsimdang will leave Daejeon Station.

Previously, Minister of Culture, Sports and Tourism Yoo In-chon visited the Seongsimdang Daejeon Station branch and pledged to find a solution. On the 17th, before attending a schedule at the Government Complex Daejeon, Minister Yoo visited the Seongsimdang Daejeon Station branch. He met with CEO Lim Young-jin and said, "Traditional stores in each region play a role as cultural tourist attractions, and Daejeon's 'Seongsimdang' is exactly such a place," adding, "The Ministry of Culture, Sports and Tourism will look for ways to assist."