Selective retail transactions favour prime high street locations in Seoul

Tourism recovery is driving foot traffic and supporting key retail corridors.

Retail investment activity in Seoul is expected to remain highly selective, with transactions increasingly concentrated in high street assets located in prime locations, according to JLL’s Asia Pacific Retail Market Dynamics Report.

Despite an active sales pipeline that includes department stores and shopping malls, deal closures remain limited as overall investment appetite stays subdued.

Market participants continue to favor core, well-located high street properties, whilst broader retail assets struggle to attract committed buyers. This cautious approach reflects ongoing uncertainty in the macro environment and uneven confidence across asset classes.

At the same time, tourism recovery is providing underlying support to select retail corridors. Retailers are expanding offerings in response to rising foreign visitor volumes, particularly in cosmetics, pharmacies, and vape shops targeting international consumers. However, this demand uplift has yet to translate into broader investment momentum.

Consumer sentiment remains mixed, with the CSI fluctuating across the quarter at 109.8 in October, 112.4 in November, and 109.9 in December, reflecting concerns over won depreciation and inflation pressures that continue to weigh on domestic consumption.

In contrast, inbound tourism has strengthened further, surpassing pre-pandemic levels. November arrivals reached 1,596,939, up 17.3% year-on-year, with Chinese visitors representing the largest segment at 26.9% growth. Increased visitor volumes have also supported retail spending.\

On the operational side, no new shopping mall or high street assets were added to the JLL basket in Q4 2025. Occupancy improved across key malls such as COEX Mall, One Grove, and Parnas Mall. Shopping mall vacancy declined slightly by 20 basis points quarter-on-quarter to 1.1%, while high street vacancy improved more meaningfully by 68 basis points to 14.5%, driven by stronger performance in Myeongdong and Cheongdam.

Rents rose modestly across both segments, up 0.4% quarter-on-quarter. Myeongdong led rental growth at 1.0% due to rising tourist demand, whilst Garosu-gil recorded a 0.5% decline amid ongoing stagnation.

Yields remained stable at 6.6% for shopping malls and 6.3% for high streets, with pricing trends expected to stay broadly unchanged given the dominance of small-scale, high street transactions.