Abu Dhabi retail market is facing challenges, indicates JLL


April 16, 2019 | By RetailME Bureau

The performance of Abu Dhabi’s real estate market remained subdued in Q1 2019, indicates research firm JLL. The retail market continued to face challenges from a slowdown in retail spending and the rise of e-commerce. This saw many mall operators offer extensive leasing incentives to attract and retain retailers.

No major retail completions took place during the first quarter of 2019, leaving the total retail stock unchanged at 29 million sqft GLA. Supply is expected to increase significantly with approximately 2.2 million sqft of retail GLA scheduled to be delivered by the end of 2019. The key anticipated delivery in 2019 is that of Al Maryah Central on Al Maryah Island. The remainder of upcoming stock is made up of retail shops within mixed-use developments.

An additional 2.4 million sqft of GLA is expected to handover in 2020, increasing the total supply of retail space in the capital to just over 32.2 million sqft. As with all sectors of the market, JLL remains cautious of the delivery of these projects and can expect delays as mall owners take time to strategise and reposition their assets in order to stand out against subdued market conditions.

Despite the limited amount of retail space entering the market in Q1 2019, retail rents continued to decline as vacancy rates increased. Average retail rents across all mall types registered drops of 5% year-on-year (y-o-y). Meanwhile vacancy rates increased y-o-y to register 22%. As a result, and in line with trends elsewhere in the UAE, retail mall owners are becoming more flexible and are offering a wider range of incentives to attract new tenants and retain existing ones.

Despite these efforts however, vacancy rates continue to increase in many malls, particularly the lesser performing, lower quality retail centres. This pressure is also mounting from the growth of e-commerce, which poses a threat to traditional and less diversified malls. Consequently, the government launched Retail Abu Dhabi (RAD), an annual event set to drive demand and increase footfall across malls. As part of this initiative, several malls offered significant discounts and promotions in Q1 2019.

Comments

comments

Previous Article Next Article

SHARE

YOU MAY ALSO LIKE /



Locally-owned supermarket Spinneys and pharmacy retailer Aster Pharmacy have joined forces to 

Continue Reading

September 5, 2022 | By RetailME Bureau
The pandemic has undoubtedly affected us all

Majid Al Futtaim has announced its audit reviewed operational and financial results 

Continue Reading

August 24, 2022 | By RetailME Bureau

Dubai’s largest developer Emaar has announced that it will sell it’s online 

Continue Reading

August 22, 2022 | By RetailME Bureau

Walmart announced this week that it will offer Paramount Global’s streaming service 

Continue Reading

August 19, 2022 | By RetailME Bureau

Employee retention has been on every company’s minds, especially since the fears 

Continue Reading

August 16, 2022 | By Shruthi Nair

The Frozen Chicken’ as Spinneys was fondly referred to back in the 

Continue Reading

August 8, 2022 | By Shruthi Nair

Veppy.com, a Q-Commerce marketplace startup just announced their go live date in the 

Continue Reading

July 20, 2022 | By Justina Eitzinger

GMG, a global well-being company retailing, distributing, and manufacturing a portfolio of leading 

Continue Reading

July 19, 2022 | By Justina Eitzinger

Lulu Group International recently introduced the world’s first AI-powered Food Delivery Robot 

Continue Reading

May 9, 2022 | By Shruthi Nair

Eid Al-Fitr is an occasion to gather with your friends and family 

Continue Reading

April 29, 2022 | By Zubina Ahmed

Leading retailer LuLu Group further strengthened its presence in the Emirate of 

Continue Reading

April 28, 2022 | By RetailME Bureau

Jones the Grocer, the Australian gourmet grocer and café chain, announces further 

Continue Reading

April 28, 2022 | By RetailME Bureau




f
Download Images RetailME Magazine