Abu Dhabi and Dubai have together ranked among the top 17 of the most active cities for shopping centre development, states global real estate advisor CBRE’s latest Global Shopping Centre Development report.
Both the emirates currently have a total of 6.7 million sqft of total retail space under construction, an 11% rise on last year’s figures. Dubai accounts for approximately 3.9 million sqft and Abu Dhabi for 2.9 million sqft of retail space.
According to the 2016 report, the Middle East retail market remains a very attractive proposition for international brands. Dubai ranks second for international brand presence with high per capita incomes, significant growth potential and a high spending consumer base.
“We know that consumers across the Middle East like to spend their money on retail, F&B and leisure activities particularly within the mall environment. The on-going investment across the region is therefore catering to these needs and with retailers from across Europe and the US continuing to look for alternatives to drive future expansion, the region offers a wide range of opportunities for consumers,” says Matthew Green, head of research and consulting, CBRE Middle East.
“The Middle East offers a tried and tested marketplace for investors with less risk than those normally associated with emerging markets. This is clearly reflected in the size of the development pipeline for the region, especially so for Dubai and Abu Dhabi. With demand for new stores being sustained across key markets, developers remain bullish on the outlook for the retail sector in the region”, Green adds.
Within the Middle East, the UAE’s development pipeline is significant with a number of major malls scheduled for delivery over the next three years. Nakheel’s Palm Mall in Dubai, comprising around 1.2 million sqft of GLA and is expected to complete in 2018, and The Point, which has a total GLA of 516,668 sqft and is due to open in 2017. In Abu Dhabi the next super-regional shopping mall expected to be completed is Maryah Central that will offer around 1.6 million sqft GLA.
The report also outlines that Doha is currently witnessing a transformation of its retail sector amidst an on-going construction boom, which could see around approximately 13 million sqft GLA delivered over the next three years alone, with the government striving to modernise the city in the build up to the 2022 Qatar World Cup.
At nearly 2.8 million sqft GLA, Doha Festival City, due to open in late 2016, is also set to become the largest mall in the country, featuring around 550 retail shops, including over 100 F&B outlets. The mixed-used scheme will combine retail with leisure, dining, entertainment and hospitality, including Doha’s first snow park as well as the region’s first Angry Birds indoor/outdoor theme park and a theme park dedicated to the rapidly growing ‘gaming’ community.
Beyond the Middle East, China remains the most active market in terms of delivery of new space, accounting for two-thirds of construction globally. Cities such as Chongquing, Shenzen, Chengdu and Shanghai all have over 32.2 million sqft of space under construction in over 30 projects in each city.
Emerging markets such as Manila, Moscow, Mexico City and Bengaluru completed over 64.5 million sqft in 2015. However, activity in Eastern European markets has slowed due to economic and political uncertainty.
The Global Shopping Centre pipeline continues to increase from 420 million sqft in 2014 to 451 million sqft with Asian cities dominating nine out of the top ten most active global markets, CBRE indicates.
Our Facebook page carries CBRE’s figure on shopping centre completions in 2015