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Famous Seoul retail strip Myeongdong’s vacancy rate exceeds 40 per cent

With strong social distancing measures enforced to limit the spread of the coronavirus, the number of vacant commercial properties in South Korea is on the rise – and rents are falling.

And nowhere is it being felt as bad as in the famous Myeongdong shopping district where the vacancy rate has reached 43.3 per cent. That compares to 31.9 per cent in Itaewon and 22.6 per cent in the Hongdae/Hapjeong neighbourhood.

The Korea Real Estate Board has reported a 9.5 per cent vacancy rate for large-sized stores and a 6.5 per cent vacancy rate for small shops across Seoul.

The surging vacancy rate in the prime shopping districts is attributed to an increasing number of store closings following a steep drop in the number of foreign tourists.

With the increasing number of empty shops, rental fees have also decreased. The average rental fee for large-sized stores in the second quarter of this year was 0.21 per cent lower than the previous quarter, reaching 25,500 won (US$22.18) per square metre.

Rental fees for small shops stood at 19,100 won per square meter, and aggregate stores at 27,000 won, for drops of 0.21 per cent and 0.15 per cent, respectively, since the previous quarter.

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