In the commercial areas surrounding Seoul’s universities, cafes, restaurants, and stores that offer low-cost options are still managing to survive. However, restaurants that charge regular prices are finding it increasingly difficult to stay in business. This is due to recent price hikes that have impacted the spending habits of students and young professionals. As a result, there has been a noticeable shift in the commercial districts of Seoul’s university areas.
On Apr. 18, at Ewha Womans University shopping district in Seoul, several shops were being closed down and building materials scattered inside. Signs indicating clearance and rent were visible in multiple shops as one walked from the main gate of Ewha Womans University towards Sinchon train station. Even popular restaurants among students have been closing down one after another.
The owner of a Western-style restaurant that was previously popular enough to have a waitlist expressed his disappointment, “I struggled to keep going, hoping that business would pick up after the pandemic, but with decreasing visitors and rising costs for ingredients, labor, and rent, I ultimately had to close down. It’s upsetting because I had plans to expand to a second location when business was good.”
Mr. A had been running a brunch café for over a decade, but recently he decided to shut it down. He revealed that the café used to be very busy during lunchtime with a lot of students and Chinese customers, but as the prices increased, eating out became an extra burden for the customers, which led to a decrease in customer visits. To reduce labor costs, he tried to work alone, but unfortunately, he has been in debt for over eight months and has even fallen behind on rent.
The decline of university area commercial districts is also evident from statistics. According to the Ministry of Public Administration and Security, the closure rate in Seodaemun District last year, which is home to Yonsei University, Ewha Womans University, and Hongik University, increased by 4.3 percentage points to 19.8% compared to the previous year (15.5%). This area is particularly sensitive to price changes.
On the other hand, in Mapo District, near Seodaemun District, in front of Sogang University, the number of unmanned stores and low-cost restaurants is increasing. In the Sogang University commercial district alone, around 50 snack bars have been identified. Unmanned ramen stores and snack bars, where meals cost less than 5,000 won, are popular among students as they are cheaper than meals at the university cafeteria.
On Apr. 18 at 1 PM, a gimbap restaurant located in front of Sogang University was packed with students, leading to significant order delays. The reason why the restaurant was crowded was that they offered gimbap at relatively low prices, and only 3,000 won ($2.17). Next to the gimbap store, an unmanned ramen store, which cost less than $3, was also crowded with customers. In this ramen store, customers can choose their own ramen, add ingredients, and cook it themselves.
Mr. Jang, who was studying for the civil service exam, mentioned that having meals in a regular restaurant often costs over $7, which is expensive for him since he has no income. Therefore, he looked for cheaper restaurants to save money, and here, he could eat a more satisfying meal for about a dollar less than at a regular snack bar.
Lee Eun-hee, a professor of consumer studies at Inha University, said “with limited income and rising prices, people inevitably have to cut back on dining out first. Consequently, the number of small business owners and self-employed individuals may decrease in the future.”
