Anticipation Grows in Gwangju and Southwest Region Over 800 Trillion Won Semiconductor Investment

Samsung Electronics and SK Hynix have announced plans to invest a total of 800 trillion won in semiconductor facilities in Gwangju and the Southwest region, raising expectations in the local retail industry. The establishment of large-scale semiconductor production sites is anticipated to attract a significant influx of high-income professionals and workers from partner companies, thereby expanding the local consumer market.

According to industry sources on July 2, Samsung and SK Hynix are pushing to build four semiconductor fabs in Gwangju and the Southwest region, although specific locations have yet to be determined. During a national report meeting on major projects held at the Blue House on June 29, Samsung Chairman Lee Jae-yong mentioned Gwangju as a potential investment site, while SK Group Chairman Chey Tae-won highlighted the Southwest region.

The investment amount is equivalent to the combined gross regional domestic product (GRDP) of Jeonnam and Gwangju for five years. The semiconductor industry is characterized as a cluster industry, where production facilities are accompanied by equipment, materials, and research and development personnel. Thus, the realization of fab construction is likely to lead to an influx of not only factory workers but also employees from partner companies and service sectors, significantly increasing demand for housing, education, and commercial services.

In the department store sector, Shinsegae and Hyundai Department Store, which have previously invested billions of won in the Gwangju area, are optimistic about capturing shopping demand due to the semiconductor cluster's potential economic boost.

Currently, Shinsegae Property, a real estate development subsidiary of Shinsegae Group, is working on the 'Grand Starfield Gwangju' project, aiming for a 2030 opening in the Gwangju Adeungsan Tourism Complex. This will be Gwangju's first large-scale complex shopping mall, combining Starfield with hotels, condos, and a golf course.

Gwangju Shinsegae is also undergoing a major expansion. Through the 'The Great Gwangju' project, which will invest 3 trillion won by 2033, it plans to construct a new department store annex and build a 35-story, 180-meter tall bus terminal building along with four mixed-use buildings ranging from 42 to 44 stories in height near the Gwangcheon Terminal area. This aims to expand the existing urban commercial district into a broader regional market.

Hyundai Department Store is also preparing to re-enter Gwangju. It plans to open 'The Hyundai Gwangju' in 2029 on the site of the former Jeonbang and Ilshin Textile in the Buk-gu district, marking its return to Gwangju after 16 years since its exit in 2013.

Existing retail stores are also expected to benefit. Lotte Department Store in Gwangju has maintained a position in the early 40s in domestic department store sales rankings. However, with the establishment of the semiconductor cluster, the consumer population in Gwangju is expected to grow, increasing demand for premium products and positively impacting sales at existing stores.

A department store industry insider stated, "If large-scale semiconductor investments are realized, it is highly likely that both the population and purchasing power in the Honam region will increase. The retail development projects underway in Gwangju are also expected to have a long-term crowd-attracting effect."