Alphabiz - Lotte and Hyundai Duty-Free Enter Bids for Incheon Airport Shops Vacated by Shilla and Shinsegae

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[Alpha Biz= Kim Jisun] Lotte Duty-Free and Hyundai Duty-Free have submitted bids for two Incheon Airport duty-free licenses recently vacated by Shilla and Shinsegae Duty-Free, according to industry sources on January 20.

The two licenses, DF1 and DF2, cover the third-floor departure terminal, with DF1 focusing on perfumes and cosmetics (15 stores, 4,094㎡) and DF2 on liquor and tobacco (14 stores, 4,571㎡). Shilla Duty-Free and Amolux (formerly Dufry), which were expected to participate, did not submit bids, while Shinsegae Duty-Free withdrew its application at the last minute.

A Shilla Duty-Free representative cited ongoing uncertainties from changing consumer patterns and market conditions as reasons for not participating. Both Shilla and Shinsegae previously withdrew from Incheon Airport duty-free operations due to declining sales.

In response, Incheon International Airport Corporation (IIAC) issued a new bidding notice last month. The contentious issue of rent was adjusted downward: DF1’s per-passenger rent fell from KRW 5,346 to 5,031 (VAT included), a 5.9% decrease, while DF2’s dropped from KRW 5,617 to 4,994, an 11.1% reduction.

The contract term is approximately seven years, ending June 30, 2033, with an option for renewal of up to 10 years under relevant laws if requested by the winning bidder.

Alphabiz Reporter Paul Lee(hoondork1977@alphabiz.co.kr)