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Shinsegae Acquires Real Estate in Bukchon Hanok Village for 41.5 Billion Won

[비즈한국] As confirmed by BizHankook's investigation, Shinsegae004170 has recently purchased a significant amount of real estate in Seoul's Bukchon Hanok Village. Shinsegae, which operates department stores, has previously conducted marketing activities in Bukchon through subsidiaries such as Shinsegae International031430 and Shinsegae Casa. In the vicinity, cosmetics company Amorepacific090430 successfully attracted visitors by purchasing old houses and transforming them into experiential retail spaces; speculation is emerging that Shinsegae may also establish a base in Bukchon to market its own and its subsidiaries' products. Shinsegae stated, "No specific plans for usage have been decided yet."

According to the industry and property registry, Shinsegae purchased two buildings and a 1,190㎡ (360-pyeong) plot of land in Bukchon Hanok Village, Gahoe-dong, Jongno-gu, Seoul, for 41.5 billion won on the 22nd of last month. The seller is Kim Taek-sung, CEO of Samhwa Paper, a specialty paper manufacturer. The transaction involved a one-story hanok house (119㎡ in gross floor area) and a two-story western-style commercial facility (494㎡). While both buildings were originally classified as residential, the zoning of the western-style building was changed to a neighborhood commercial facility in September, just before the acquisition. Both buildings are currently vacant.

Bukchon Hanok Village, where Shinsegae purchased the real estate, is a densely packed hanok area in Gahoe-dong, Jongno-gu, Seoul. It served as a residential area for the yangban (aristocracy) during the Joseon Dynasty, and as urban populations flowed in during the 1930s due to the expansion of Seoul’s administrative districts, real estate developers built numerous small and medium-sized hanok houses in groups. There are currently around 900 hanok houses preserved here. Jongno-gu estimates that 6.64 million visitors visit Bukchon Hanok Village annually.

Shinsegae has previously engaged in marketing activities in Bukchon Hanok Village through its subsidiaries. In October last year, Shinsegae International, a fashion and beauty subsidiary, operated an experiential pop-up for its cosmetics brand 'Yunjac' at a hanok hotel in Bukchon. In 2022, Shinsegae Casa, a furniture and interior subsidiary, opened 'The Living Room,' a community lounge featuring its premium furniture, in the area. It is understood that this is the first time Shinsegae, the parent company operating the department stores, has directly engaged in marketing in Bukchon.

A Shinsegae representative simply stated, "While it is true that we purchased the real estate, no specific usage plans have been formulated yet."

This is not the first time a retail company has acquired real estate in Bukchon Hanok Village. Amorepacific previously purchased hanok and western-style houses in 2018, converting them into experiential retail spaces for its flagship brands 'Sulwhasoo' and 'Osulloc.' Since then, they expanded their footprint by purchasing adjacent properties in September 2020 and June of last year. According to Amorepacific, the number of visitors to the Sulwhasoo Bukchon experiential store exceeded 10,000 in April last year. It is currently considered a successful marketing case that connects space with products.

The owner's influence also plays a role in Bukchon Hanok Village marketing. In the book "Two Houses in Gahoe-dong," which details the story of the Bukchon experiential stores, Amorepacific Chairman Suh Kyung-bae stated, "I wanted to buy a hanok and restore it well. As Sulwhasoo works to modernize our traditions—a principle that will not change in the future—I wanted to embody that in a physical space," adding, "I thought that if I restored the two houses well, they would become a part of Seoul's history."

Bukchon Hanok Village is also considered one of Korea's traditional wealthy neighborhoods. It is reported that numerous conglomerates own or have owned houses in the area where Shinsegae made its purchase, including Hanwha Group Chairman Kim Seung-youn, Lotte Group Chairman Shin Dong-bin, Yusu Holdings Chairwoman Choi Eun-young, the late Samsung Group Chairman Lee Kun-hee's wife Hong Ra-hee (former director of Leeum, Samsung Museum of Art), Dongkuk Steel460860 Chairman Jang Se-joo, and former Donga One Group Chairman Lee Hee-sang.

A real estate industry official noted, "Bukchon Hanok Village is one of the few areas in the heart of the city that preserves Korea's traditional residential culture, and it has become a must-visit tourist destination for foreigners. For this reason, there is a growing trend of flagship stores and pop-up stores that promote company products and services in Bukchon," adding, "There is likely no space as attractive as Bukchon Hanok Village for sustaining the Korean image or the Hallyu wave."