[Euljiro Rotary] 'This' Threatening Hipjiro Known as a Cost-Effective Commercial Area

③Reasons Why Young Entrepreneurs Flock to Hipjiro

Editor's NoteThe other name for Euljiro is 'Hipjiro.' Although the area presents a chaotic scene with old buildings and reconstruction scattered throughout the alleys, it offers a unique charm in that the past and present overlap. Once facing a crisis due to industrial decline, Euljiro's vitality was revived as young people continued to visit. We explore the future of the city by meeting those who have established Euljiro's position with its distinctive sensibility and those striving to carry on its legacy.

The alleys of Euljiro, called 'Hipjiro' by the MZ generation, are spaces where old buildings hidden behind high-rise buildings and 'hot places' nestled in between come together. Once the mecca of the printing industry, it has now become a 'cost-effective' commercial district sought after by young entrepreneurs. Euljiro's old scenery has been sublimated into Newtro (New + Retro), building its reputation as 'Hipjiro.' Although it became a slum due to the decline of the textile industry, young artists attracted by low rents created new culture and industries, similar to New York Manhattan's SOHO. This is why the comparison is made.

The appearance of buildings near Euljiro 3-ga Station. Photo by Seulgi Yoon seul97@

Euljiro's Monthly Average Sales Surpass Myeongdong, Ranked 1st in Jung-gu... 2nd Among Seoul's Major Commercial Districts

Euljiro is recognized as Seoul's definitive 'cost-effective commercial district.' According to Seoul City's commercial district analysis service on the 6th, the monthly average sales per store in Euljiro-dong in the fourth quarter of last year was 28.85 million KRW, ranking first among 15 administrative neighborhoods in Jung-gu. During the same period, the monthly average sales per store in Seoul was 14.86 million KRW, and in Jung-gu, it was 12.94 million KRW, about half of Euljiro-dong's average.

Even when considering Seoul's major commercial districts overall, Euljiro's sales are relatively high. A survey of 12,531 first-floor stores in 145 major commercial districts in Seoul showed that Euljiro 3-ga ranked second with 574,000 KRW per square meter, following Gangnam Garosugil at 616,000 KRW. The average sales in major commercial districts are about 372,000 KRW per 1 square meter (㎡). However, since Seoul City's commercial district analysis service calculates sales based on the average of the entire industry and the estimated information may differ from actual figures, investors should consider not only the average sales figures but also other factors.

The survival rate of startups (3 years) in the Euljiro area is also on the rise. A higher 3-year survival rate indicates a better commercial district. The 3-year survival rate for startups in this area in the fourth quarter of 2023 was 72.29%, up 2.05% from the same quarter last year and 0.76% from the previous quarter.

Looking at the industry distribution, retail is the most common, and the food service industry is increasing. Among a total of 3,065 stores, retail accounts for 63.4% (1,944 stores), food service 23.5% (720 stores), and service industry 13.1% (401 stores). Notably, the proportion of individual small businesses is higher than franchises. In Myeongdong, franchises numbered 487, about 11% of the 4,395 general stores, but in Euljiro-dong, franchises numbered 100, and general stores 2,965, with franchises accounting for only about 3%. Euljiro-dong is a place frequented by young people, with those in their 20s and 30s accounting for 52% of total food service sales.

On the other hand, Euljiro's rent is relatively low compared to other commercial districts. The typical rent for major commercial districts in Seoul is 74,900 KRW per 1㎡ (247,170 KRW per pyeong), but in Euljiro-dong, based on Euljiro 3-ga Station, it is 69,600 KRW per 1㎡ (229,680 KRW per pyeong), about 7.6% lower than average.

Continuous Inflow of Daytime Population in Euljiro on Weekdays and Weekends, Low Rent and Competition

A view of the alley near Euljiro 3-ga Station. Photo by Yoon Seulgi seul97@

Experts point out that the strength of Euljiro's commercial district lies in the Newtro atmosphere created by Hipjiro, which resonates with young people, leading to a continuous inflow of daytime population regardless of day or night, weekdays or weekends.

Professor Kim Young-gap of KYG Commercial District Analysis Institute, an expert on commercial district locations, explained, "Euljiro can be classified as an office commercial district, and usually office districts do not do business on weekends." He added, "However, with unique stores emerging in Euljiro, it has become a commercial district where people visit even on weekends." He continued, "Euljiro does not feel very bustling; rather, it has many old and worn buildings. This unique urban landscape of Euljiro, combined with low rents and key money, has allowed good stores to emerge and become famous, leading to urban growth."

However, "Even if competition among stores in Euljiro is currently less intense than in nearby areas like Myeongdong, if demand surges and redevelopment causes rents to rise, it will not be free from the threat of 'gentrification' (the phenomenon where existing commercial districts are pushed out due to rent increases following area revitalization), just like other commercial districts," he expressed concern.

This content was produced with the assistance of AI translation services.