Business | Property
Metro and retail market
Renovation projects undertaken to capitalise on surge in footfalls
- By Sam Armstrong, Contributor, Property
- Published: 00:00 October 1, 2009
- Image Credit: Christopher List, Staff Photographer, Property
It's the stuff of dreams for Dubai's retailers — hordes of shoppers swarming back into the major malls now that the Metro has given them ready, easier access to these destinations. Riding in along with the Metro may be the first hint of a turnaround in fortunes for the local retail sector after it has passed through an extended dry spell in terms of generation of new sales.
Dubai's retailers have never been short of optimism, always given to the belief that a boom will invariably follow a bust, and only differing on the time lapse between the two phases. Now, with the launch of services on the Metro, even if only partial, they believe the platform has been created to give the sector a much needed lift.
"We expect the Metro to be a great boon for the malls," says Ajai Kumar Dayal, general manager for retail and marketing at Easa Saleh Al Gurg Group, expressing a sentiment that is fast becoming an article of faith among industry circles. Sales figures have undoubtedly fallen due to the recent financial climate, and yes it will take time to see the benefits of the Metro, but we hope for a return to the stronger sales of 12 months ago by the end of the year."
The Easa Saleh Al Gurg Group is backing up this belief, and with funds to match. It recently unveiled a major makeover at its IDdesign showroom in Mall of the Emirates, in the process committing "a huge investment in both time and money. It was undertaken in three phases to avoid any store closure during the process, the cost was almost equivalent to a new outlet. Only 30 per cent of the original space remained untouched," says Ajai.
Shopping convenience
In fact, the rationale behind the makeover was a direct response to a need — as the Mall of the Emirates shifted its focus to the first-floor Metro station, IDdesign saw the space at its existing showroom reduced.
The retailer was not alone in prepping itself up ahead of the Metro launch. At the Mall of the Emirates, the Majid Al Futtaim Group — the owner — has been working closely with RTA for over 18 months to create a retail experience for passengers alighting at the popular mall.
With an overall investment said to be worth Dh500 million, the new extension will feature air-conditioned ‘travellators' transporting shoppers directly into the mall.
The only mall situated on the main junction connecting the Red and Green lines on the Metro network, BurJuman, expects a significant lift in the numbers paying a visit.
Eisa Adam Ibrahim, general manager, is ready for the surge, "We have upgraded and renovated the area adjacent to the Metro (north ground floor) and we will continue the enhancement to ensure on-going synergy with the Metro."
Anticipating demand
As residential and commercial construction projects have slowed, the retail sector has been quietly active in preparing for the new possibilities. And before they see gains, most have accepted the need to put money into costly renovation projects designed to capitalise on the surge in footfalls.
According to the RTA, the Red Line will have a capacity of 23,000 people per hour in each direction, and the Green Line will be able to shuttle 19,000 people per hour.
Even if only a percentage of these travellers head for the malls, those are decent numbers to contend with. But what about malls not on the route, and retail concepts yet to be built? Only time will tell whether the Metro line becomes the city's main artery with developments jostling for the most accessible positions or whether the RTA will expand its network as the city evolves.
From a financial context, the retail sector's sales hopes lifting ultimately depends on the take-up of the new service. While there are expectations of increased footfall and walk-in visitors, it all hinges on who uses the Metro and for what purpose.
The true test is whether those passing through a mall actually end up buying from there rather than just using the Metro to get there. Twelve to 18 months ago it was considered an accolade for the city's malls to be thought of as tourist attractions in themselves, but in the time since, the sector realises that this has to be matched by sales. A culture of window shoppers would leave retailers doubting the benefits of their costly facelifts.
We can, however, be sure of one thing: the relationship between retailers and the Metro will be watched with interest long after the 2010 completion date.
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