Dubai: Those 80 million plus visitors who pass through each year certainly made a point — The Dubai Mall ranks higher than London’s Regent Street and New York’s Fifth Avenue in the overall quality of its retail offerings. And, yes, it’s ahead of the Champs-Elysees in Paris, according to the latest “Global Retail Destination” from Savills, the UK consultancy.

In terms of city rankings, New York leads the way, and ahead of London and Hong Kong (tied in second place) and followed by Dubai. (In all, the prime retail hotspots in seven cities were compared and benchmarked, with Milan and Singapore being the other cities.) “Dubai is forecast to report the strongest growth in retail sales over the next five years of the seven global cities examined, potentially challenging London’s West End’s current global position,” the Savills report notes.

According to a survey response in the report, 88.4 per cent of people said Dubai has the best choice and quality of shops in the world.

All of which should obviously give fresh impetus to the current round of mall developments and expansions the city is witnessing. The Dubai Mall itself is adding 1 million square feet to its existing 12 million. This apart, there are also projects from Nakheel (at the Palm and on Deira Islands) as well as the extension works at Dubai Festival City. Other capacities are also coming through, while the biggest of them all — the Mall of the World — is waiting in the wings. The brighter prospects forecast for the medium term will also give some heart to the retail sector currently going through an extended run of weak sales.

But, industry sources say, that the best part about finding retail space in Dubai is that they do not have to rely solely on the malls. The rise of retail strips, as at The Walk and The Beach plus Citywalk and Boxpark, have widened their options. There are also the communities with their neighbourhood retail offerings. Later this year, the Dubai Parks opening will offer retail options for niche brands.

“Any retailer thinking longer term can get his brand into a non-mall environment and still aim for a decent exposure and sales,” said a market observer. “The mall need not be the only option.”

The number of overnight visitors to Dubai, between 2016-20, is expected to increase by 9.7 per cent. Mastercard’s Global Destination Cities Index 2015 estimated there were 14.3 million overnight visitors to Dubai last year, which brought on a total spend of $11.7 billion and an average of $819 per person. This puts is some distance behind New York’s average spend of $1,416.

“Dubai is now perceived as a top global retail destination,” said David Godchaux, who heads Core and the local partner of Savills. “But this is only the tip of the iceberg as we now start seeing developers trying to improve the shopping experience not only for tourists as in the past 15 years, but also for residents.

“This trend of moving away from the ‘bigger is better’ approach, to more user and resident friendly retail developments, bringing a real city experience and European-style shopping to areas of Dubai similar to those found in London, Paris and Milan, is something that was much awaited by the market and that we see finally happening.”

The pesky issue of mall rentals

UAE retailers have a common refrain — that they have to spend way too much to confirm a location at any of the city’s premier malls. But if they were to read the Savills report, they might get some relief.

“Dubai Mall was the least expensive in terms of indicative prime total occupational costs as of Q4-2015 — prime rent per square foot $240, additional occupational costs psf $60 and a total occupational cost psf (of) $300,” the report says.

“This compared to the total occupational costs psf in New York’s Fifth Avenue — $3,900.”

In terms of shopper experience — assessed via location surveys focusing on responses related to ease of shopping, connectivity, service levels and directional signage — Dubai outperformed London, Paris, Singapore and Milan.