Supply of mega malls in Dubai close to capacity

Dubai: The supply of mega malls in Dubai is nearing capacity, increasing the need for greater shopping diversity, according to a leading figure at real estate developer Nakheel.

David Thurling, CEO of Nakheel Retail, developer of projects such as Ibn Battuta Mall, says local developers must focus on new shopping concepts such as factory outlets, town centre style shopping zones, themed malls and retail outlets linked to main transport hubs.

"The challenge for us in the industry is to think outside the square and to look at mall design in a different way for it to be competitive and offer something new in the market," told delegates at the Retail City trade show in Dubai.

"I don't know whether we can build these mega malls in Dubai forever. From a Nakheel point of view we are very mindful of this and are looking at different forms."

Dubai has a vast supply of current and upcoming large scale malls, such as Mall of the Emirates and Dubai Mall.

Low shopping space

According to figures supplied by Colliers International the amount of shopping space per capita in Dubai is low at 1.05 square metres, proving that there is room for expansion. However, most of the 1.37 million square metres of leasable retail space that Colliers says will be built in Dubai in the next two years will be in the form of mega shopping malls.

Nakheel itself is building retail components which will cater to 2.5 million new residents on projects such The World and The Palm islands over the next five years.

"In Dubai we have already two or three of the largest shopping malls in the world being built - we can't simply build more of the same," said Thurling, who said shopping centre diversity will be Nakheel's strategy.

He said development of value shopping such as factory outlets will be Dubai's next big growth area, rather than the current focus on high end prestige shopping.

Other concepts include lifestyle centres which appeal to the demands of an areas particular demographic and include specific well-designed retail outlets.

Another possibility is impact malls specific to a certain product category such as computers.

Outdoor town centre style shopping areas, a concept popular in the US, could also succeed in Dubai, he said.

"The challenge for us in Dubai is the climate, but for six to seven months of the year the climate is great.

"There is a great opportunity to exploit that more effectively and to look at ways of climate controlling these external spaces during the hot months."

Other ideas include retail zones linked to metro stations, malls focused on entertainment zones and shopping centres themed on a historical period or character.