GCC retail – the market is looking ahead
- Mar 3, 2015
- 3 min read
Interest in the GCC retail market is high, given the rapid changes taking place as a consequence of socioeconomic development, evolving consumer behaviour and cutting-edge technology. RetailME presents four snapshots of retail in the region –from real estate services firm Jones Lang LaSalle, market intelligence firm Euromonitor International, management consulting firm AT Kearney and payment gateway Visa Middle East
JONES LANG LASALLE: Sovereign and pension funds are big investors
The big story is that a lot of investment is happening across the world in pension and sovereign funds, with significant capital finding its way into the retail industry. Up-and-coming target areas in this part of the world include the GCC, North Africa and Sub-Saharan Africa.
“It hasn’t happened yet in the GCC, while the UAE is in a transitional phase. But things could start moving as transparency in real estate increases and the market matures. Investors will probably buy existing malls, bring new facilities and marketing ideas, leading to greater profits,” says Andrew Williamson, head of retail – MENA, Jones Lang LaSalle.
As retail moves forward towards 2020, he sees some very dynamic changes happening in the sector, with those embracing change emerging as winners, leaving behind those maintaining the status quo.
“You can’t ignore the consumers either. They’re getting smarter, accessing information real-time. That’s leading to narrowing margins for retailers, who are now looking to offer better services and facilities. Shopping centres will have to work to create unique environments to attract retailers and consumers, adding to the developer costs,” cautions
Williamson.
He draws attention to a lot of real estate developments taking place in Dubai, with several malls scheduled to come up. Large super-regional and regional centres are expected to continue to dominate the market, with most announced and under-construction malls in the pipeline having GLAs of over 322,917 sqft. “Overall, Dubai can expect around 9 million sqft of new retail space to enter the market by 2016,” says Williamson.
The picture is similar in Abu Dhabi. In addition to super regional malls, a number of retail centres within mixed-use developments are expected to enter the market by end-2013, with total retail space expected to touch 28 million sqft of GLA by 2015.
“Overall, the regional retail industry will continue to thrive due to increasing purchasing power, a growing expatriate population and expanding tourism and hospitality sectors,” Williamson concludes.
Interest in the GCC retail market is high, given the rapid changes taking place as a consequence of socioeconomic development, evolving consumer behaviour and cutting-edge technology. RetailME presents four snapshots of retail in the region –from real estate services firm Jones Lang LaSalle, market intelligence firm Euromonitor International, management consulting firm AT Kearney and payment gateway Visa Middle East
JONES LANG LASALLE: Sovereign and pension funds are big investors
The big story is that a lot of investment is happening across the world in pension and sovereign funds, with significant capital finding its way into the retail industry. Up-and-coming target areas in this part of the world include the GCC, North Africa and Sub-Saharan Africa.
“It hasn’t happened yet in the GCC, while the UAE is in a transitional phase. But things could start moving as transparency in real estate increases and the market matures. Investors will probably buy existing malls, bring new facilities and marketing ideas, leading to greater profits,” says Andrew Williamson, head of retail – MENA, Jones Lang LaSalle.
As retail moves forward towards 2020, he sees some very dynamic changes happening in the sector, with those embracing change emerging as winners, leaving behind those maintaining the status quo.
“You can’t ignore the consumers either. They’re getting smarter, accessing information real-time. That’s leading to narrowing margins for retailers, who are now looking to offer better services and facilities. Shopping centres will have to work to create unique environments to attract retailers and consumers, adding to the developer costs,” cautions
Williamson.
He draws attention to a lot of real estate developments taking place in Dubai, with several malls scheduled to come up. Large super-regional and regional centres are expected to continue to dominate the market, with most announced and under-construction malls in the pipeline having GLAs of over 322,917 sqft. “Overall, Dubai can expect around 9 million sqft of new retail space to enter the market by 2016,” says Williamson.
The picture is similar in Abu Dhabi. In addition to super regional malls, a number of retail centres within mixed-use developments are expected to enter the market by end-2013, with total retail space expected to touch 28 million sqft of GLA by 2015.
“Overall, the regional retail industry will continue to thrive due to increasing purchasing power, a growing expatriate population and expanding tourism and hospitality sectors,” Williamson concludes.
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