2023.01.31
[Interview] Hong Kong's art work 'big hand'...
Song Moon-suk, CEO of Incheon International Airport, creating the world's largest storage facility
Completion of the world's largest and cutting-edge art collection at Incheon International Airport in 2026 Song Moon-suk, CEO of ARSHEXA, who won the Incheon Airport project Art storage and contribution to the growth of the Korean art market Planned investment of 380 billion won... “45% of rental demand already secured, 70% target before construction starts”
The world's largest art collection will be built on the site west of Incheon International Airport. The site size alone is 43,669 square meters, and the total floor area is 94,644 square meters. It is the size of 11 football fields.
The amount spent on the Incheon International Airport art storage project alone is about 380 billion won. When the storage facility is completed in 2026, Ars Hexa Incheon International Airport Freeport Special Purpose Company (PFV) will be in charge of its operation. The PFV organizer is Ars Hexa. CEO Song Mun-suk, who leads the company, invested seven full years to win the Incheon Airport storage project.
CEO Song met with Chosun Biz on the 26th and said, “The business that I have been working on day and night for 7 years has now taken its first step, and I want to complete it to the end and help make Seoul a hub for the Asian art market.” He added, “Storage storage is a basic infrastructure that is absolutely necessary for the development of the Korean art market.”
CEO Song started the storage project because he calculated that Korea was now ready to emerge as the center of the Asian art market.
The first reason was that the Korean economy has grown to a level comparable to that of other developed countries and that art-loving consumers have emerged. In addition, Korea has excellent construction technology and many cutting-edge IT technologies that will be applied to storage facilities. There were enough investors with the capital to lead the business successfully.
Hong Kong's introduction of a national security law was another big change. In Hong Kong, Asia's art hub that accounted for 30% of the world's art market, there was a voice that said that it would not be able to do the art business because of anxiety. In addition, when moving to the Japanese art market, I was worried about frequent earthquakes, and it was difficult because Taiwan has cross-strait relations with China.
After hearing the concerns of Hong Kong art market officials, CEO Song thought that the big players in the art market would eventually choose Korea as the hub of the Asian art market. Considering the size of the economy, social stability, and soundness of government policies, there is no substitute for Korea.
CEO Song started to speed up his business. 7 years spent like that. The effort paid off on August 30 last year. To be precise, I clicked the first button. On this day, CEO Song signed a concession agreement with the Incheon International Airport Corporation for the Incheon International Airport Art Storage Development Project.
What will the world's largest storage facility led by CEO Song look like in 2026? I heard about the storage business. The following is a Q&A with CEO Song.
-How did you come up with the idea of starting a storage business?
“Seven years ago, while running my own business in Paris, France, I began to look at the art market as an industry. At that time, Korea's national income approached 30,000 dollars, and global galleries began to enter Korea. I thought that the art market, which was extremely small compared to other Organization for Economic Cooperation and Development (OECD) countries, would grow in earnest.
When art meets industry, infrastructure is essential. The first infrastructure to find when super-expensive artworks entered Korea was the storage room. From then on, I started researching the Freeport-type storage model located in various bases around the world. If possible, I wanted to build a storage facility near Incheon Airport.”
-It must not have been easy to catch Incheon International Airport Corporation.
“I put in a lot of effort. From the beginning, he received consulting from Deloitte. We prepared details on why art storage is needed and how to develop it. We discussed this again with the airport corporation. When we were selected as the preferred bidder, we scored 987.2 points out of 1000.
I think we got good grades because we have the same orientation. Incheon Airport is also aiming for a culture and art airport. Incheon International Airport Corporation has a plan to attract world-class art museums, galleries, auctions, and art fairs based on its art collection. I plan to be active here as well.
In line with this, it is representative of promoting a complex development project that includes an ‘art gallery’ in the long-term parking lot south of the Incheon International Airport Passenger Terminal 1 Transportation Center. This site was originally planned as the second passenger terminal, similar to Hong Kong's Chek Lap Kok Airport, but as the location of the second passenger terminal was changed to the north of Yeongjong Island, it is currently used only as a ground parking lot.”
-What kind of changes will occur in the Korean art market when the storage facility is built?
“It's easy if you think of using mercenaries in professional baseball and professional basketball. If you bring in foreign players with excellent athletic ability as mercenaries, the level of players will rise and their performance will also improve. If the world's leading storage is located in Korea, the level can rise as world-class art and domestic art are mixed.
Just because the Korean economy has grown into the top 10 in the world, it is difficult for the Korean art market to suddenly rise to the top 10. However, if you have top-notch storage, you can advance that time.”
-What kind of synergy can you create with Incheon International Airport?
“Incheon International Airport is one of the world's leading airports. When the expansion of the second passenger terminal is completed in 2024, it will have two passenger terminals that can accommodate more than 100 million passengers and more than 50 million international passengers for the first time in the world. The storage facility, to be completed in 2026, will add wings to Incheon International Airport to become a platform for culture and art by adding to this quantitative growth. It will change into a place that becomes a tourist attraction in itself, rather than simply being an airport.”
-Why do you think Korea will be reborn as Asia's art hub?
“There are several reasons, but first of all, the domestic art consumption market has matured. You can see the potential of the domestic art market last year. More and more people consider art as part of their asset portfolio. Last year, the domestic art market exceeded 1 trillion won, and what is important is the trend. Although 1 trillion is a large amount, I think it is an amount that confirms the potential and starting point of the development of Korean art.
Last year, large-scale art fairs in Korea were also successful. In particular, foreign galleries were all surprised by the holding of ‘Freeze Seoul’. Overseas galleries initially submitted works at the level of ‘tapping’ (similar to demand research in the securities industry). In fact, I don't think there were many high-quality works.
However, the heat was unexpectedly hot. Looking at the reactions of overseas galleries, many say that next year, the level of work they bring to Korea will be different. All of these will be found in decent storage. In order not to damage the value of the good works brought, storage is essential.”
-Even though the number of consumers who love art has increased, there are many Asians who are interested in the art market, such as Hong Kong and Singapore.
“Singapore, Japan, Taiwan, and China are all looking at the art market. Among them, Hong Kong accounts for 30% of the global art market. So far, it is by far the leader.
But Hong Kong has problems with the National Security Law. The Hong Kong National Security Law, which came into force on June 30, 2020, makes four crimes punishable by up to life imprisonment: separatism, overthrow of the state government, terrorist activities, and collusion with foreign powers. As the law enters its third year, many capitals in Hong Kong are preparing to leave their nests in Singapore and elsewhere. It is anxious.
There is already a storage facility at Changi Airport in Singapore. It is a great airport that competes with Incheon International Airport for world rankings, but I know that 86% of Changi Airport's storage is already full. Not enough space. Changi Airport's storage has a total floor area of 30,000 square meters, while the storage at Incheon International Airport Corporation has a total floor area of 94,644 square meters. more than twice as large.
Japan cannot be free from the earthquake problem. For example, in the case of oil paintings, there are cracks (gold), but if the cracks become severe due to an earthquake, the value of the painting decreases. So, the size of the storage is bound to be small. This is why the storage capacity of Japanese airports has been at the level of 9917㎡ (3000 pyeong) for the past 10 years.
The storage capacity of Geneva Airport in Switzerland is already saturated, and Luxembourg Findel Airport is already 96% full. Beijing, China also has a large market and airport storage, but there are political and institutional risks (risks). Korea definitely has a competitive edge.”
-Are there any other advantages besides the area?
“Storage is the spearhead of cutting-edge technology. Storage requires the latest proven technology. Korea has accumulated such technology. For those unfamiliar with storage, it is explained that wine storage is built in an air-raid shelter.
Biometric access devices, fire extinguishing devices using halogen gas, transportation routes directly connected to panic runways and facilities that ensure extreme security and safety... In the first half of Christopher Nolan's movie 'Tenet', there is an explanation of the state-of-the-art facilities of the art storage, which are all implemented in the storage at Incheon International Airport.
Fumigation and nitrogen disinfection facilities to sterilize and disinfect works brought in, viewing rooms where customers can appreciate and check the works they are storing, storage facilities by grade to store works of different storage methods such as temperature and humidity, auction art Personal storage to be used by fairs and safes for digital artworks, whose market will grow in the future, will be installed in the storage of Incheon International Airport Corporation. The competitiveness of these state-of-the-art facilities is great. This is because everyone wants to keep their valuable artwork safe.”
-When the storage facility is built in 2026, has the quantity to be filled secured?
“As of now, more than 45% of the leases have already been confirmed. We are running with the goal of securing more than 70% of leases before construction starts. I think it's quite achievable.
It competes with the world's storage but goes together. It signed an operation advisory consulting contract with ISA, a Luxembourg storage operator, and is in Seoul with business explanations and negotiations with France's J.neux, which operates about 80 offshore storage stores around the world. Negotiations with world-class auction houses and global-level galleries are also underway.
In particular, the Japanese art world is very interested in the storage project at Incheon International Airport. We are discussing the development and operation of storage with Japanese art fairs such as Art Tokyo, Shinwa Auction, SBI Art Auction, and advertising agency Dentsu.”
-How is the ARSHEXA consortium structured?
“Construction investors (CI) are Dongbu Construction and POSCO E&C, financial investors (FI) are Eugene Investment & Securities and Mastern Asset Management, and strategic investors (SI) are Dongyang, SK Broadband, Sonide, Gallery Bisunjae, Shinsung Safe, etc. Shinsung Safe is one of the most important parts of storage, and Shinsung Safe is the place where most bank safes are made in Korea. Architectural design is provided by Haeahn Architectural Design Office, accounting advice is provided by Samil PWC Accounting Firm, and legal advice is provided by Shin & Kim Law Firm. We also put a lot of effort into forming the consortium.”