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Small biz in the area hit by gentrification, USFK relocation
By Jhoo Dong-chan
A renovated three-story building, across the street from the Hamilton Hotel, has remained vacant for nearly a year. Despite its proximity to Itaewon Station on Seoul Metro Line No. 6 and a large floating population at night, the building's owner is experiencing difficulty in finding new tenants.
"There were a number of franchise restaurants, coffee shops and clothing stores in the area several years ago, but they started shutting down about three years ago," said a 37-year-old Itaewon resident surnamed Roh.
"The area is still busy with party people at night, but there are not many people during the daytime."
Retail businesses in Itaewon area are struggling due to soaring rent and the economic slowdown. Youngsters and foreigners still visit the area for drinks and partying at night, but activity is completely different during the daytime.
"A tenant store owner asked for the rent to be lowered several months ago. He said his brunch store was losing customers so he couldn't pay the current rent," said a Gyeongnidan building landlord surnamed Lee. Gyeongnidan is one of Itaewon's neighborhoods, known for its cafes, bakeries and restaurants.
"He and I agreed to keep the rent at the current level for now. However, he is likely to shut down his business soon if it fails to attract more customers."
According to the Korea Appraisal Board, the vacancy rate of medium- and large-sized stores in Itaewon area stood at 26.5 percent as of the second quarter of this year.
Medium- and large-sized stores here refer to business venues with a gross floor area larger than 330 square meters, and the vacancy rate in Itaewon is the highest among Seoul's major business districts.
Experts said the Yongsan Relocation Plan to redeploy U.S. Forces Korea (USFK) personnel south to Camp Humphreys in Pyeongtaek, Gyeonggi Province, was another reason behind the soaring vacancies in the area.
The relocation started in July 2017, and not many people are left in Yongsan Garrison now.
The vacancy rate in Itaewon was 14.9 percent in the second quarter of 2017, but jumped the following quarter to 19.1 percent.
"The USFK population totals about 29,000 troops. Accounting for their family members, the base was home to more than 100,000 Americans," said a real estate agency operator surnamed Nam.
"They greatly contributed to the local economy. Without them, Itaewon is no more than another drinking district with a large number of foreigners."
An Itaewon resident surnamed Kim said Itaewon is also losing its charms with the soaring rent in the area. Kim was born and raised in Morocco, but was naturalized as a Korean citizen several years ago.
"There were a number of characteristic places here featuring exotic atmospheres. It was fun to hang out in the street here. But, now it has completely turned into a drinking district. I'd rather visit Euljiro now," he said.
"And it doesn't look safe at night as much as Seoul does during the daytime. I live here, but don't really hang out anymore."
