Lotte, Aman: Seoul Luxury Hotels Expand Suites, Cut Rooms

Seoul's Expanding Luxury Hotel Landscape

Seoul's luxury accommodation sector is undergoing a significant transformation, with hotels prioritising room quality and value over sheer size. This strategic shift involves reducing the total number of rooms while enlarging the remaining ones and adding more suites.

Lotte Hotel Seoul recently concluded its first major refurbishment in 47 years, unveiling the Grand Lotte Seoul on 18 August. This renovation saw the room count on its main building's 7th through 21st floors decrease from 737 to 590, with each room becoming more spacious.

The Plaza hotel plans to close at the end of September for approximately three years, reopening with a focus on top-tier suites rather than standard deluxe rooms, according to the hotel groups.

Global Brands Enter a Growing Market

The South Korean capital is also attracting new high-end international operators. Paradise Group is constructing an 18-storey, all-suite hotel with about 200 rooms in Jangchung-dong, scheduled to open in 2028. Swiss-based ultraluxury chain Aman announced on 2 September that Aman Seoul would open by 2030 on the former Prima Hotel site in Cheongdam-dong.

Aman Chairman Vladislav Doronin described Seoul as a global city where culture, design, technology, and wellness converge. Rosewood Seoul is set to open next year, 2027, on the former United Nations Command site in Yongsan District, and Mandarin Oriental plans a hotel near Seoul Station in 2030. These new additions follow earlier luxury entries such as the Four Seasons in 2015 and Signiel Seoul in 2017.

Tourism Growth and Supply Constraints Drive Premiumisation

This luxury boom is supported by Seoul's rising appeal as a tourist destination. Korea received a record 18.94 million foreign visitors last year, 2025. Data from Cushman & Wakefield shows Seoul hotels averaged a 79.2% occupancy rate in 2025, exceeding pre-pandemic levels. Revenue per available room (RevPAR) reached 207,345 won ($150) in 2025, marking a 67% increase from 2019.

However, supply has not kept pace, with new hotel openings in Seoul adding only about 1,000 rooms annually, a quarter of the pre-pandemic rate, due to soaring land, construction, and financing costs. This environment makes a luxury strategy more appealing, as hotels can achieve higher earnings per room.

Implications for Asia's High-End Travel Market

The shift in Seoul's hospitality market reflects a broader trend towards premiumisation in Asian travel. While five-star hotel rooms nationwide rose 12.1% and four-star rooms 28.8% from 2022 to 2024, one-star rooms fell 45.9%, according to the Ministry of Culture, Sports and Tourism and the Korea Hotel Association.

Seoul's five-star hotel supply currently constitutes only about 20% of its total, a figure lower than comparable cities like Tokyo or Singapore. This gap shows significant potential for continued growth in the luxury segment.

Travellers to Seoul can anticipate a greater selection of high-end accommodation with enhanced amenities, though this may also lead to increased pricing for premium offerings. Other Asian cities experiencing similar tourism growth and supply constraints may observe Seoul's strategy for their own market development.