Shinsegae Group plans to turn gas stations into commercial complexes that combine retail and mobility, the retail-focused group said Wednesday.
Its property development arm, Shinsegae Property, has signed a business partnership with Koramco Energy Plus REITs for the project.
The plan is to transform gas stations owned by the real estate investment trust into what it described as “new distribution bases in urban areas that incorporate commercial facilities with distribution.” The envisioned complexes will also double as logistics centers so the company can develop a better “last mile” delivery system.
By taking advantage of the gas stations’ urban locations, the complexes can also work as “local community platforms” that provide various food and beverage brands and entertainment content.
The term “last mile” refers to the last stage of a delivery process, when a service or product reaches its final destination. It concerns product quality management, fast delivery and customer satisfaction.
Koramco Energy Plus REITs, which is listed on the Korea Composite Stock Price Index, operates 170 gas stations in cities across the country and boasts an annual return of 6 percent for investors, the company said.
According to the deal, Shinsegae Property will oversee every stage of development ranging from concept plans to construction design and process, as well as process management.
“The latest development project not only transforms gas stations into commercial facilities but creates an environmentally friendly space that works as a new regional logistics platform,” one official at Shinsegae Property said.
“We plan to continue pursuing new business models and various mixed-use development projects and solidify our position as a property developer,” the official added.