South Korea’s small-business sector is facing growing difficulties. University neighborhoods are also seeing more vacant storefronts. According to the Korea Real Estate Board, the vacancy rate for general retail properties nationwide reached 13.4 percent in the second quarter of 2026. Vacant storefronts can reduce foot traffic and have a negative effect on nearby businesses. Declining consumer spending, the growth of online shopping, and high rents are raising concerns that the downturn could continue.

What is happening in Gongneung-dong?

The area serves students and residents, with spending by students being an important source of revenue for nearby restaurants and cafes. The SeoulTech visited the popular pub Yeogi Ggochine (여기, 꼬치네) and spoke with its owner, who also serves as the vice president of the merchants’ association Gongjon (공존).

Q. Are small businesses in Gongneung-dong, including Yeogi Ggochine, facing difficulties in general?

A. Many people say things are even harder now than they were during the COVID-19 pandemic. Business owners in Gongneung say customers do not spend as much as they used to. This is a nationwide trend that includes even prominent commercial districts such as Gangnam and Hongdae.

As costs rise, people are increasingly reconsidering whether they can afford to eat out. Eating out used to be something people did without giving it much thought. Now, I think people have started asking themselves, “Do I really need to eat out?” Even though the situation is not very hopeful, new small businesses open as usual. When people get older, they must retire, but they still need to earn money. It is a vicious cycle, so to speak.

Q. Do you think the changing culture around drinking less alcohol also affects business?

A. The situation is especially visible because Gongneung-dong depends on student consumers. In the past, when 100 customers came to a restaurant, they would consume around 100 bottles of alcohol. Now, the same number of customers might consume only 60 to 70 bottles. Welcome parties, senior-junior gatherings, and group dinners have all decreased sig nificantly.Yeogi Ggochine has also faced these difficulties.

The owner, who has operated the business for eight years, said the situation has become so difficult that he considered closing. “To be honest, I even considered closing during the summer vacation,” he said. He responded to the crisis by acquiring another store, describing the decision as “a huge risk.” He said more storefronts in major commercial areas of Gongneung-dong are now up for lease or sale.

Q. Is there anything else you think businesses should do to make it through this difficult time?

A. Rather than having individual businesses compete simply to survive, merchants need to work together. This idea led to the creation of Gongjon, a merchants’ association with more than 100 participating businesses. It is not about each of us trying to survive on our own. We all need to do well together. Gongjon has introduced a 5 percent discount coupon that is valid for one year at participating businesses. The goal is to encourage regular customers and keep spending within the neighborhood, as customers move from restaurants to nearby cafes or bars. I want to emphasize the importance of university-business cooperation.

Gongjon supports SeoulTech student festivals and provides equipment and event space, and I hope to expand this kind of cooperation to other universities in Nowon-gu. Most of the business owners who started around the same time as I did closed their businesses eight years ago. Now I am one of the more experienced owners here. Despite all the difficulties, I am always grateful. We can make a living thanks to the students. And to the international students who read the article, please feel free to come to my restaurant, where you can order just drinks if you don’t want to order food. I understand what it’s like to be an international student as I used to be one in Japan. I will show you the warmth of Korea (laughs).

His goal is for both his restaurant and the entire district to thrive. The challenges facing small businesses in Gongneung-dong cannot be solved through individual efforts alone. Commercial districts depend on consumer spending, foot traffic, and connections with surrounding institutions. Therefore, revitalization requires cooperation among business owners, local governments, universities, and residents.

It requires sustained consumer spending and an environment in which existing businesses can continue operating. The future of Gongneung-dong will depend on whether business owners, universities, local governments, and residents can continue working together to build that environment.

 

Reporters

Jiyun Bae

jenneybae@g.seoultech.ac.kr

Seongbeom Hong

hongsb@seoultech.ac.kr

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홍성범 기자

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• e-mail : hongsb@seoultech.ac.kr