"No Premiums" for New Storeowners Entering Itaewon, While Existing Owners Lose Their Deposits

[경향신문]

Around 6 p.m. October 21, more and more people show up at the World Food Street in Itaewon, Yongsan-gu, Seoul. Kang Eun

The time is 6 p.m. October 25, and the place is the World Food Street in Itaewon, Yongsan-gu, Seoul. When I walked twenty steps from Itaewon Station exit 1 and turned right into an alley, I came across the door of an izakaya decorated with 3-4 wreaths congratulating the opening of the bar. A poster looking for employees was posted on the wall to the right of the entrance. It read, “We welcome new family members who will work with us.” The owner of the bar, Yi Hun-hui (47), who opened the bar on October 20, said, “Many stores had closed, and perhaps because of that, the rent for the place I moved into was about 20% cheaper. I opened the bar to secure a spot early since things will get better thanks to the move toward life ‘with covid.’”

After the government eased social distancing measures from October 18 and declared a move toward life “with covid,” storeowners along the streets of Itaewon, Yongsan-gu are showing a mix of expectations and concern. Itaewon was a popular destination among foreign tourists and young people, and it was one of the places hit most severely by the pandemic. Particularly after the clusters of transmission at clubs in May 2020, people stopped visiting Itaewon and many stores closed. According to the Korea Real Estate Board, the vacancy rate of mid to large-sized commercial buildings in Itaewon in the fourth quarter of 2020 reached 26.7%.

This day, when I visited the streets around Itaewon Station exit 1, I found four to five stores that had recently opened within a distance of 400m. Gim (35), who is preparing to open a pub in a space nearly 300 m2 this month, said, “Originally in Itaewon, you had to pay a premium of hundreds of millions of won to open a store, but this time, I rented the store without a premium.” He added, “Things aren’t as good as before, but when you look at the other stores, customers are increasing and on weekends, things are pretty lively again.” The interior decoration for Gim’s pub, such as the kitchen renovation and painting, is about half finished.

Storeowners who did business here from before the pandemic said the damage was too big to expect an economic recovery.

Bak (50), who was hanging pumpkin decorations on the ceiling to prepare for Halloween said, “It (rent) went down slightly for vacant lots, but it’s still the same in places that were already leased.” He said, “You can say that natives like me will be pushed out from here.” He further explained, “I suffered losses of 1 billion won just from rent in the last year and a half while running three to four stores,” and added, “Now, I hardly have any deposit left to retrieve.”

Yi Seung-cheol (50), who has run a bar in Itaewon for fifteen years said, “The rent for our store dropped about 20%, but I expect it to return to its original level by next year (when we recover from covid).” Yi (62), who has been running a tarot shop for five years said, “Even if we recover from covid, the mood is never going to be as lively as before.” She also said, “The government says it will compensate for the losses, but it’s like giving an elephant a biscuit.”

New storeowners are not all full of hopes either. Gim said, “Sales from my previous store already dropped by half. It is true that I worry that covid may get worse again and business won’t be good, that things could get harder.” Yi said, “When I said I was opening a store, the people I knew asked me why of all places I had to open in Itaewon,” and added, “I’m not sure, but I am pretending to be confident.”