Shinsegae, U.S. startup to build Korea's largest AI data center, with Lutnick's endorsement

Shinsegae Group is entering the AI race, partnering with U.S. startup Reflection AI to build what it says will be Korea’s largest AI data center.

Shinsegae Group Chairman Chung Yong-jin, left, and U.S. Commerce Secretary Howard Lutnick pose for a photo during a Christmas dinner held at the official residence of U.S. Vice President JD Vance in Washington on Dec. 12, 2025. [SHINSEGAE GROUP]

Shinsegae Group is entering the AI race, partnering with U.S. startup Reflection AI to build what it says will be Korea’s largest AI data center.

The retail conglomerate said Monday it held a signing ceremony in San Francisco for a memorandum of understanding on a “strategic partnership to build a Korean sovereign AI factory.”

The event was attended by Shinsegae Group Chairman Chung Yong-jin, Reflection AI CEO Misha Laskin and U.S. Secretary of Commerce Howard Lutnick. Lutnick reportedly expressed his expectation of the project's success.

The AI data center is set to have a capacity of 250 megawatts, making it the largest in Korea. Graphics processing units (GPUs), a key component of AI data centers, will be supplied by Nvidia through Reflection AI.

“Reflection AI received $8 billion in investment from companies including Nvidia last year, so large-scale GPU supply is expected to proceed smoothly,” a Shinsegae Group official said.

The agreement marks the first technology cooperation case under the U.S. government’s “AI Exports Program” announced in July of last year. The U.S. Commerce Department is seeking to export not only AI data centers, but also broader AI ecosystems built around such facilities. Lutnick’s attendance at the signing ceremony reflects that initiative.

Shinsegae Group and Reflection AI plan to establish a joint venture this year and begin selecting a site for the project.

Shinsegae Group logo [Shinsegae Group]

Shinsegae said the data center will be built as a “full-stack AI factory” that provides cloud services and customized AI solutions. The company plans to actively use Reflection AI’s open-weight AI model development technology.

Unlike closed AI models, open-weight AI models allow users to modify model structures according to their needs, enabling independent management of information.

Laskin reportedly described Korea as a global IT powerhouse and a strong ally of the United States, adding that the two companies aim to create AI infrastructure that allows Korea to develop its AI capabilities independently.

Shinsegae also plans to develop differentiated AI commerce based on the data and infrastructure it has accumulated in the retail sector. For example, the company is exploring AI agents that can automatically recommend optimized products for customers on online shopping platforms and handle payment and delivery. It also plans to develop a full-stack AI system applicable across its retail operations to improve inventory efficiency and speed up delivery, ultimately boosting profitability.

“AI will fundamentally transform all sectors, including industry, the economy and human life,” Chairman Chung said. “Future industries will not be able to survive without AI. This collaboration will not only serve as the foundation for Shinsegae’s future growth but also contribute to advancing the AI ecosystem across Korea’s industries.”

This article was originally written in Korean and translated by a bilingual reporter with the help of generative AI tools. It was then edited by a native English-speaking editor. All AI-assisted translations are reviewed and refined by our newsroom. BY CHOI HYUN-JU [shin.minhee@joongang.co.kr]