SINGAPORE - Changi Airport Group (CAG) has awarded its liquor and tobacco concession tender to South Korean company Lotte Duty Free.

This is the first time that a new operator is being awarded the category, and comes after the DFS Group said in August that it was pulling out of the airport after 38 years of selling liquor and tobacco.

The contract awarded to Lotte is for six years from June 9, 2020. The tenancy contract covers all 18 liquor and tobacco stores across Changi's four terminals, spanning more than 8,000 sq m of retail space.

DFS' duty-free stores will close next June, when its lease expires, to make way for Lotte.

In a statement on Thursday (Oct 24), CAG said that passengers at Changi can look forward to a wide range of liquor products and brands housed within Lotte's 18 liquor and tobacco stores.

The liquor and tobacco duplex store at Terminal 3 will see a complete revamp of its store facade for greater visibility into both levels of the store.

All of Lotte's stores will also include experiential activities, such as personalised products like customised whisky-blending.

CAG's executive vice-president (commercial) Lim Peck Hoon said: "Lotte put forth the strongest and most compelling proposal overall."

She added that Lotte also demonstrated a keen understanding of the market environment with a sound business plan supported by a competitive financial bid and backed up by solid business fundamentals.

The evaluation process for the tender closed on Aug 26. The proposals received were evaluated based on a holistic set of criteria covering both qualitative and quantitative factors, CAG said.

This tender was Changi Airport's most significant leasing exercise since the last round of tenders was conducted for the liquor and tobacco, and the perfumes and cosmetics concessions in 2013.