Dubai: Even Yas Mall’s quite substantial 230,000 square metres are not enough to whet the Abu Dhabi retail sector’s need to find new space for itself.
Vacancy rates at Abu Dhabi’s existing malls are unchanged at around the 2 per cent mark in the 12 months to end June, based on estimates by the consultancy JLL. What it means is that a new generation of shopping destinations is what the emirate needs. And they are coming.
Recently, the Urban Planning Council formally granted approval for the Reem Mall (with a 185,000 square metre spread) at the Reem Island master-development. Just this week, a statement was put by the developer of the $1 billion (Dh3.67 billion), 215,000-square metre Al Maryah Central that vertical construction has commenced.
Both Reem Mall and Al Maryah Central are setting themselves up for completion in 2018.
“The new malls are of a scale that they can create an offering for a large segment of the public, ranging from value to luxury,” said Andrew Williamson, Head of Retail at JLL MENA.
“Each developer will create a unique mix that will cater to the segment they are targeting, [with] new community malls filling the needs of quick-service retail. Reem Mall is anticipated to fill a needed gap with it’s mix of hypermarket, retail and unique leisure offering.”
According to a recent JLL report, “Supply is expected to increase significantly from 2018 with the delivery of new super-regional malls. With greater competition, we expect the market to polarise with lower quality malls needing to be repositioned.
“There is potentially further supply in the pipeline at varying stages of approvals, funding and pre-leasing.”
Even existing malls are not ruling out further expansion possibilities. “There are a few plans in the pipeline — Deerfields Mall [an 80,000 square metre build] is part of MBI which is also an asset and retail management company,” said Banu Tas, Vice-President, Asset Management & Retail, Deerfields Mall. “We expect an expansion will remain with the real estate aspect of the business and we expect to make the news public by 2016.
“We aim to have full retail occupancy by the end of 2015. With the current rate of business enquiries, we are confident of reaching that.”
Currently, the mall — located on the Abu Dhabi-Dubai highway and with a fairly large consumer base within its immediate neighbourhood — is running at well over 80 per cent occupancy.
“With malls, occupancy is an ongoing business process,” said Tas. “Our primary audience has always been the residential population of over 120,000 in the neighbourhood. The commuter traffic is our secondary target audience (and) every week, approximately 400,000 commuters travel on the Dubai-Abu Dhabi highway.”
