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Lotte, Shilla win preliminary bid for new Incheon airport duty-free

All News 18:24 April 21, 2017

By Kim Seung-yeon

SEOUL, April 21 (Yonhap) -- The duty-free units of Lotte Group and Hotel Shilla have each won the preliminary bid to run stores at the new Incheon International Airport terminal slated to open later in the year, the airport authority said Friday.

Lotte Duty Free and Shilla Duty Free have been picked as winners of the first round of the licensing bidding for the fragrance and cosmetics section and the liquor and cigarettes section at the second airport terminal (T2) at South Korea's main gateway, which will begin operations in October, according to the airport.

The preliminary bidding is the first part of a two-phase procedure to win the licensing for new duty-free shops. Once the Incheon International Airport Corp. (IIAC) selects multiple candidates for the designated slots, they are then assessed for a second time by the Korea Customs Service for the final decision.

While details on the prices were undisclosed, bidders apparently offered a total of some 205.3 billion won (US$180.8 million) for the new duty-free operations, according to officials familiar with the matter.

However, the bidding for the fashion and accessories slot fell through with none of the duty-free operators tendering their bids, as jitters from a decline in Chinese tourists following Beijing's ban on trip sales to Korea have dampened their appetite for fresh investment.

Shinsegae Duty Free and Hanwha Galleria were also among the bidders but failed to make it to the initial winners list.

IIAC plans to restart the bidding for the thwarted sections either through a private contract or at a lower price, it said.

The final bidder is expected to be announced next month.


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