Dubai: Abu Dhabi’s retail space is getting a distinctively upscale edge to it.
The Galleria – the first retail component within Sowwah Square, a leisure and entertainment destination magnet in the making for Abu Dhabi – is to open on Tuesday. There will be more than 100 premium outlets and scaling up to 140, and comes with comprehensive F&B elements in place. A second retail component, Sowwah Central, is due for an opening in 2017.
These are located on Al Maryah Island, formerly Sowwah Island, and forms part of a top-tier mixed-use development that will have hotels and Grade A offices. The new headquarters of Abu Dhabi Securities Exchange is also based there.
This will shortly be followed by the retail portion, again markedly premium in scope, at the World Trade Center Abu Dhabi. And yes, the sprawling Yas Mall is in the final stretch for its opening date.
As for The Galleria, “It was fully leased a good six months before today; this location combined with a large retail site across the street (that part of Sowwah Central which is due for opening in 2017) brings a market dominance type of project,” said Kevin Ryan, managing director — development at Gulf Related. “The intention was always to offer excellent access to all of the Abu Dhabi marketplace, that is be a draw for anyone within a 30-minute drive.
“Abu Dhabi’s retail map shows a significant consumer base who shop locally, but many of the high spending shoppers go and do so in Dubai. We intent to pitch The Galleria as offering the right products targeted at such shoppers and capture their spending.”
The Galleria’s theme is niche luxury on the retail side. When the full retail space at Sowwah Central too gets commissioned, it will add up to 190,000 square metres of gross leasable area. In industry parlance, that places it in the category of a ‘full-scale regional shopping centre’.
“Demand exists in Abu Dhabi for premium retail space due to the spending power of the residents, anticipated growth in tourism and population growth,” said Andrew Williamson, head of retail for Middle East and North Africa at the real estate consultancy Jones Lang LaSalle (JLLS). “New luxury offerings are able to attract higher rental rates from the retailers.
“The Galleria will add to the positive story that is unfolding at Sowwah Central with a very strong mix of luxury brands and F&B that should prove popular in an increasingly expanding market.”
JLLS estimates Abu Dhabi will add around 1 million square metres of retail space between 2013 and 2017. Ryan notes that there is a “slight” rental gap between what The Galleria commands and the upcoming retail portion in Sowwah Central. “Yes, The Galleria’s offering would be at a level of quality higher than what it is currently in the marketplace,” Ryan said.
Incidentally, the idea of creating retail spaces for automotive brands was considered for Sowwah Central, similar to what is being seen at the Burj Downtown, “But the option was discussed but is not being explored,” Ryan said.
Gulf Related is a joint venture between Gulf Capital and US-based realty investor Related. For the latter, the Abu Dhabi development offers a platform to look at a wider regional footprint when the time is opportune. It is also working on a residential project in Saudi Arabia.
As to why a US firm was interested in a space that has been dominated by GCC mega-developers, Ryan said: “Related’s expertise has been in mixed-use projects in the US and we saw there was an opportunity to be involved in similar opportunities in the region.”
