Lotte to pour $6.4 bil into retail business over next five years Lotte Shopping to lead retail investment with focus on developing shopping complexes

Translated by Ryu Ho-joung 공개 2022-05-27 08:05:53

이 기사는 2022년 05월 27일 08:00 더벨 유료페이지에 표출된 기사입니다.

South Korea’s Lotte Group will pour 37 trillion won ($29.2 billion) into core industries over the next five years under the new administration led by President Yoon Suk-yeol, with retail accounting for about a fifth of the total investment.

Lotte Shopping plans to invest 8.1 trillion won in the retail industry, with a focus on developing new shopping complexes. More than half of the amount is expected to be allocated to that category.

The development of shopping complexes will be led by the retailer’s department store division. This move is in line with changes in business strategies of domestic department stores, which seek to get bigger and have their own uniqueness to lure consumers to offline stores.

Lotte Shopping bulked up by merging with its four development subsidiaries earlier this year. It also took over operation rights to several shopping complexes in Seoul and Gyeonggi Province from Lotte Asset Development, which is in the process of liquidation.

The development of shopping complexes is expected to lead to vitalizing local economies and creating more jobs. Lotte Shopping’s department store division had 30 department stores, 22 outlets and five shopping malls at the end of 2021.

“Lotte Department Store is working on large-scale shopping complex development projects in areas like Mapo-gu in Seoul and Songdo in Incheon, which will have the effect of creating jobs,” an official at Lotte Shopping said. “Such development projects require long-term investments.”

Lotte Shopping will also allocate 1 trillion won to its supermarket chain division. The focus of the investment in Lotte Mart will be on renewing its stores, rather than launching additional ones, to be better positioned to attract consumers amid the economy reopening. The number of Lotte Mart’s stores decreased to 112 at the end of 2021 from 125 at the end of 2019.

In December last year, Lotte Mart’s Jamsil branch was renamed Zettaplex Jamsil after renewal. Zettaplex is the chain’s premium supermarket brand. Lotte Mart also launched wine shop chain Bottle Bunker. The supermarket chain is working on rebranding its warehouse retail chain, Vic Market, to MAXX.

Lotte Shopping posted revenue of 2.14 trillion won and an operating profit of 57.2 billion won in the first three months of this year, up 0.93% and 4.23% year-on-year respectively.

“We intend to invest in our supermarket chain division, with a focus on renewing existing branches with brands like Zettaplex, MAXX and Bottle Bunker, rather than increasing the number of stores,” the Lotte Shopping official said. (Reporting by Hyo-beom Lee)
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