Lotte, Shilla To Close Duty-Free Stores At Incheon Airport
Lotte Corporation and The Shilla are closing their duty-free stores at Incheon Airport's Terminal 1 beginning February 2021. This will leave more empty spaces at the airport.
Lotte Corporation is a South Korean conglomerate that offers products for skincare, makeup, perfumes, watches, jewelry, health products, baby products, and more.
Meanwhile, The Shilla is an operator of hotels and duty-free shops based in the East Asian country. It is also a Samsung affiliate.
The leases of Lotte Duty-Free and Shilla Duty-Free have expired in August but were extended for six months more after new bidders backed out prior to signing contracts. One of the reasons for the closing is the ongoing coronavirus pandemic threatening shopping businesses worldwide.
The Customs Act is making it impossible for them to continue to operate, which is why they will be officially closing reportedly this February 2021.
On Sunday, an official at Incheon International Airport Corporation (IIAC) said, "We are considering passenger demand, COVID-19 vaccines' approval and other issues related to the pandemic to make a decision on the timetable and terms for the rental bidding process."
In January 2020, IIAC started the bidding process for new duty-free store operators, offering lower rents with the aim to keep shopping at the airport alive amidst the pandemic. However, the efforts of the airport officials are seemingly inadequate to fend off the growing uncertainty of shopping at the airport.
Previously, it was reported that IIAC approached the tenants to continue to operate in Terminal 1 within flexible arrangements, after "high-profile tenders for the facility were not picked up." During this time, The Shilla confirmed the continuity of their operations but on a temporary basis due to the lack of operators.
Lotte also agreed to extend their operations at that time, in line with the completion of their business structure. These developments came after retailers did not show interest in operations at Incheon Airport Terminal 1, one of the most sought-after locations in the country.