Dubai: Qatar is busying itself with not just creating the sporting arenas and metro networks — some of the most ambitious mall developments in the region are taking shape in the Gulf state. The emphasis with each of these upcoming malls is to go for the big, and the more there is of it the better.
The Mall of Qatar, with a gross leasable area (GLA) of 190,000 square metres and a first phase which will have 400 plus stores, and Doha Festival City, with 250,000 square metres of GLA, have already reached key project milestones.
And then there is Place Vendome, a $1.25 billion (Dh4.6 billion) development in Lusail City that is getting into its construction stride and that, on completion, will create a further 230,000 square metres of GLA. The Lusail City stadium will host the opening and closing of the 2022 Fifa World Cup.
“We anticipate sticking to the Q3-2017 completion schedule that we announced at the time of the construction launch in March this year,” said Sean Kelly, Project Director for Place Vendome at United Developers, one of the leading names in Qatar’s real estate development scene. “To date, we have excavated more than 700,000 cubic metres from the site and established the main contractor on site.” Current plans are to be ready to start on the piling works before year-end.
But as is the case with any new major project launch in the Gulf these days, the question always veers around to whether there is too many of the same being built at the same time. In other words, can Qatar absorb more than 500,000 square metres coming into the marketplace at more or less the same time, even accounting for the fact that the 2022 World Cup is being hosted by it?
According to Kelly, the Qatar retail space’s fundamentals are completely different from What is there in the rest of the Gulf states. “The unorganised retail sector in Qatar makes up 70 per cent of the market and it’s only the remaining that find a space within mall environments,” said Kelly. “In any mature retail market, it’s the other way round.
“So, in tandem with the new mall developments, there’s a natural shift happening in terms of retailer and consumer preferences. It means there’s space for all.”
According to Mark Proudley at the Qatar office of the consultancy DTZ, “Retail rents within malls have remained firm with strong population and economic growth driving demand, while delays in completion of new malls has restricted the expansion of supply. DTZ anticipates that the large pipeline will create a clearly defined two-tier market with malls that best meet fundamental consumer demands — in terms of location, layout, parking and facilities — attracting the optimal tenant mixes, high occupancy levels and premium rents. In contrast, older malls that are badly configured and suffer from low levels of parking will start to see increasing levels of vacancy and reduced rents.”
With the initial infrastructure in place, the developer is hoping to have a leasing strategy/structure in place by November before going into the market with it.
“When Place Vendome opens, we are absolutely certain that the location by the sea will prove a must-see attraction for locals and visitors alike,” said Kelly. “It’s going to be a natural canal destination. There will be something for everybody.
“Through the years since the launch and build-up of Lusail City, the basic infrastructure (at the master-development) is already at an advanced stage. In fact, that made it easier for us to launch and start work on-site for Place Vendome. And we have all the funding in place to take us through the project on schedule.”
Qatari Diar Real Estate Co. is the master-developer of Lusail City.
