Lotte Duty Free to close COEX store in central Seoul

Lotte Duty Free, South Korea’s largest duty-free business operator, is closing one of its flagship stores in Seoul in the wake of the COVID-19 pandemic amid growing competition among retailers.

Lotte, also the world’s second-largest duty-free shop, said on Wednesday it will shut its COEX store in Gangnam, Seoul, after 12 years of operation.

The Lotte Duty Free COEX store opened in 2010 when Lotte Group acquired AK Duty Free business from Aekyung Group. The license for the store expires at the end of this year, but the company said it will close it sometime in the second half.

Instead, it will concentrate its operational capabilities in two other major stores in Seoul – the Jamsil-based World Tower branch and the downtown Meyong-dong shop.

The World Tower store boasts the largest number of brand boutiques of any travel retail store in the posh Gangnam area, according to Lotte.

“This decision is a special measure to take another leap forward ahead of the endemic,” said a Lotte Duty Free official.

Citing Korea Duty Free Association figures, Lotte said that overall duty-free sales by operators in Korea stood at 17.65 trillion won ($14 billion) in 2021, down 29% from the pre-pandemic revenue of 24.86 trillion won in 2019.

Meanwhile, the company said last month it is opening a downtown store in Sydney after Australia reopened its international borders to foreign visitors.

Globally, Lotte operates 11 shops largely in the Asia Pacific region, targeting Chinese travelers, the world's largest spending group at duty-free shops.

Write to Jong-Kwan Park at pjk@hankyung.com
In-Soo Nam edited this article.