[Photo by Kim Jae-hoon]
South Korea’s main air gateway Incheon International Airport for the third time is expected to fail to sell new concession opening as it stays idled amid ongoing pandemic.
Incheon International Airport Corp. (IIAC) drew only two bidders for six Terminal 1 concession operation rights until Monday, or a day before the tender deadline. The auction would have to be cancelled due to lack of bidders for an open tender.
The IIAC is looking for tenants who would run four duty-free concessions reserved for big travel retailers and two zones reserved for small and medium sized enterprises. By Monday, it has received only two bids – one from large duty-free shop operator Shinsegae and one from small player The Grand.
Its previous auction held two months earlier also failed to attract enough bidders, although the IIAC offered to shave rent by 30 percent or receive rent in proportion to revenue earned until the air traffic volume recovers to 60 percent of the pre-coronavirus pandemic level.
After multiple failures, the airport authority is expected to opt to sign into individual contracts to fill the openings.
If the IIAC decides to make private contracts, only the travel retailers who submit a bid by the deadline date, which is Tuesday for the third auction, will be eligible to enter into an agreement. Individual contracts, however, could stoke protest from other tenants as terms for private contract can be negotiated.
By Park Dae-eui and Cho Jeehyun
[ⓒ Pulse by Maeil Business Newspaper & mk.co.kr, All rights reserved]