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Mall development heats up

Posted By on June 18, 2014

“UK and US retailers are frustrated by the lack of space,” said Maclean. ”Around 100 are waiting to get into Mall of the Emirates [MoE] and about the same number into The Dubai Mall.”

Maclean also noted that rising rents don’t seem to be a concern, especially with European retailers. Mature markets Abu Dhabi and Dubai are considered mature markets, but follow different trends. ”Abu Dhabi’s new retail- ers, such as at The Galleria and upcoming Yas Mall, have helped improve the ranking of the UAE overall, following the global trend where lux-ury fashion dominates new market entrants. Dubai, how-ever, signals a mature market expansion,” said Maclean.

Cafes and restaurants account for the largest retail segment that want to oper-ate in Dubai, followed by a mix of retailers that include pet shops and pharmacies and then by mid-range fash-ion brands.

Experts say the ongoing expansion oflarge malls, such as The Dubai Mall and MaE, and the development of a su-per mall at Mohammad Bin Rashid City will complement Dubai’s goal of attracting 20 million tourists in 2020.

“There is room for a large mall for the future,” said Ma-clean. “The market capacity to absorb more retail is there.”

The report also revealed that it is the smaller retail-ers that are looking to grow faster, while the large ones are more focused on con-solidating their footprint and expansion. However, Dubai may have to fast-track new projects for small retailers.

Community malls

“We don’t have room for the smaller retailers,” said Maclean. “We need to create retail space for them within residential areas.”

While a number of ma-jor retail projects are un-derway such as the Nakheel Mall and Le Pointe on The Palm Iumeirah, the ongoing trend bodes well for smaller

The Dubai Mall (above) and other leading malls in the emirate are continuing to expand
their retail offerings, luring shoppers with a wider range of choices and new experiences

community malls and retail strips, which are springing up around Dubai, such as The Beach and City Walk.

Majid Al Futtaim (MAF) Properties, which is spending Dh22 million to redevelop the Deira City Centre and around Dhl billion to expand MoE, is also investing in the new community mall concept.

Five are already operating in Sharjah under the Matajer brand through MAF’s Sharjah Holding joint venture with the government, while Dubai will have its first My City
Centre in Tecom’s IMPZ.

“We’ll be growing Vox cinemas and moving exist-ing and new retail around,” said George Kostas, CEO of MAF Properties. “There is a lot of demand from residents to create a lifestyle. The mar-ket isn’t at risk of saturation. We’re investing Dh3 billion today, seeing an enormous potential to build more for both tourists and residents.”

MAF’s malls in Dubai saw an 8 per cent growth in foot-fall last year. Interestingly, 75 per cent of shoppers at MoE are UAE residents. “Tourism is great to have, but our business is focused on residents,” said Kostas.

The rise in retail has also brought challenges as retail-ers are crying out for logistic support. “Shelves shouldn’t have to wait for two to three months to be restocked,” said Maclean. “This is a great op- portunity for developers, cautious up to now, to build logistics infrastructure. The surge in residential develop- ment is leading to the com-
mercial sector catching up.”

Source: Property Weekly


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