November 02, 2021 08:48
High-tech start-ups and major IT companies are relocating from Pangyo just south of Seoul to Seongsu-dong near the center and next to the sprawling Seoul Forest.
The area is an industrial neighborhood that has been undergoing rapid gentrification. One insider said, "Real estate prices in Pangyo and Gangnam are so high now and buildings are so full that landlords can pick and choose which tenants to accept, but Seongsu-dong is both easily accessible and has more reasonable rents."
Computer game developer Krafton formed a consortium with Mirae Asset Global Investments earlier this month to buy the former E-Mart headquarters in Seongsu-dong for more than W1 trillion (US$1=W1,178). Krafton plans to turn the 20-story building into its own new headquarters.
A Krafton staffer said, "Gangnam and Pangyo are not only expensive but full, so we looked for other areas and decided on Seongsu-dong."
Until the 2000s, Seongsu-dong was a decaying light industrial zone. In the 1980s it was dotted by shoemakers, steel shops and other workshops, but many of them moved out of the capital and the area went into decline.
After 2010 the area gentrified as empty warehouses and workshops were taken over by coffee shops, restaurants and galleries, which then boosted the attractiveness of the area to IT companies. The pandemic has sparked an IT business boom and many companies that sought a better working environment after attracting cash injections relocated to Seongsu-dong.
Fashion "unicorn" Musinsa relocated from Gangnam to a shared office building in Seongsu-dong in September last year. It spent W84.1 billion on a piece of real estate there and is building a new headquarters. Earlier, car-sharing app Socar, educational app Enuma, and robot coffee shop Lounge Lab also moved to the new high-tech mecca.
"Seongsu-dong is not only a center for start-ups but also the culture scene, which provides inspiration for young entrepreneurs," an insider said. That may also be the reason talent management giant SM Entertainment moved there this year.
Companies appreciate the convenient location just across the Han River from Gangnam and within walking distance of Seoul Forest and the riverside park. "Seongsu-dong has buildings and space that can be used for research and development and more big businesses will relocate here in the future," an IT industry insider said.
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