Magok Plaza underground arcade vacant for nearly a year
Several units in the Magok Plaza underground shopping arcade in Gangseo-gu, Seoul, have gone without tenants for nearly a year. Despite sitting beside a subway transfer station and large office complexes, the spaces have failed to attract bidders 12 consecutive times, pushing the annual asking rent down to roughly half its original level.
According to Onbid, the Korea Asset Management Corporation's electronic asset disposal system, the Seoul Business Agency (SBA) is accepting lease bids for units 1 and 2 of the Magok Plaza underground arcade through 6 p.m. Thursday. It is the 13th tender since the first bid opened in November last year, following 12 straight failures. The winning bid will be announced Friday at 10 a.m.
Unit 1 on offer has a leasable area of 73 square meters and an annual asking rent of 20.13 million won ($15,100). Unit 2 covers 84.54 square meters and carries an annual asking rent of 23.22 million won. Those figures represent drops of roughly 49 percent and 51 percent, respectively, from the initial asking prices of 39.57 million won and 47.5 million won. Value-added tax and maintenance fees are not included, and the lease term runs five years from the contract start date.
A visit to Magok Plaza on Wednesday afternoon highlighted the site's strong transport links. The arcade connects directly to Magok Naru Station, a transfer point for subway Line 9 and the Airport Railroad, and an underground passage extends to Magok Station on Line 5. Surrounding the plaza are corporate office facilities — including Osstem Implant and LG Group's AI research center — as well as COEX Magok, a large exhibition and convention complex.
Even those locational advantages have not been enough to secure a tenant. An official from SBA's Magok Industrial Complex operations team, which oversees the bidding, said the price had fallen sharply from the initial listing but may have looked daunting earlier in the year. "Some prospective tenants may have been put off by the size — 73 or 84 square meters — or worried about foot traffic because the units are underground," the official said.
Calls to improve the utilization of the Magok Plaza underground arcade are not new. In May last year, Seoul Assembly member Kim Chun-gon visited the plaza and held a meeting with SBA officials and tenant representatives, raising concerns about vacant units and a shortage of rest facilities. The gathering discussed converting some spaces to public-lease use, expanding amenities, and introducing youth entrepreneurship and AI content programs.
Of the arcade's 14 units, numbered 1 through 14, units 1, 2 and 9 are currently vacant and listed for tender. Units 7, 8 and 10 house food and beverage outlets, while the remaining units serve as an urban smart farm and a city-run experiential facility called Seoul Future Lab. Unit 9 is slated to be developed into a runner's station.
The contrast with nearby above-ground retail could hardly be sharper. An official at a real estate agency near Magok Naru Station said vacancies in the area are now almost nonexistent. "Companies have been moving in steadily since last year and the year before, and there are almost no empty storefronts now," the official said.
The official added that monthly rents for ground-floor units of about 33 to 43 square meters run between 3 million and 5 million won, with prime spots reaching 6 million won a month. "The current rent at the Magok Plaza arcade is not particularly expensive compared with the surrounding market," the official said.
SBA said it is cautiously optimistic that this round of bidding will finally attract a tenant. "We have received a lot of inquiries this time, so we think it will probably be awarded," an official said. If the units go unsold again, however, the annual rent will be recalculated next year based on an appraisal value.
Experts said the broader Magok commercial district should remain competitive going forward. Kim Hyun-su, a professor in the urban planning and real estate department at Dankook University, said retail vitality ultimately comes down to spending volume and visitor numbers. "Magok is seeing active corporate move-ins and large-scale mixed-use development such as COEX Magok, making it one of Seoul's more resilient commercial zones," Kim said.
Kim acknowledged that individual units could perform differently depending on location, rent level and lease terms, but added that Magok's overall strengths — public transit access, green space and the like — should keep the district's retail scene in good shape.
shy@heraldcorp.com
