Al Bhatti
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May 20, 2013
Dubai retains standing as global retail haven
Emirate a close second to London in retailer representation, fourth in new store count
A mature marketplace it may be, but Dubais retail sector has no intent to slow down. It is getting a lot of help from global retailers intent on getting the word out that they will be opening soon in Dubai.
So much so, Dubai has easily retained its ranking as the number two destination in terms of global retailer representation, just behind London and well ahead of the likes of Paris, Moscow and New York.
In the latest annual rankings put out by the real estate consultancy CBRE, Dubai had a 53.8 per cent representation in terms of global retailer presence against Londons 55.5 per cent. These percentages are unchanged from 2012, while third-ranked Paris had 44.2 per cent retailer representation.
Dubai retained its position on another key score it was placed fourth among global cities which attracted new store openings in 2012, behind Hong Kong (still benefiting from being seen as a launch pad by brands with an eye on the mainland), Kiev and Berlin. In fact, Dubai shared the fourth spot with Singapore and Sao Paulo.
A presence in Dubai means global brands can get to have a buy-in from GCC tourists and simultaneously tap the international tourism market the emirate has created around retail, said Matthew Green, head of research and consultancy at CBREs regional operations. With the region doing well and growing at 3-4 per cent and even higher, Dubai is the key entry point for retailers.
American labels certainly appear to be in a rush to enter Dubai; they made up 18 per cent of all new market entrants last year. This is a trend that looks set to continue going by the still unsettled market conditions in western Europe, hitherto the most favoured destination for US brands.
For many brands, the bounce they are getting out of Dubai is the springboard for increased exposures in Abu Dhabi and Doha. Abu Dhabi, in fact, was among the top 10 cities favoured by luxury brands for new store openings last year. The two destinations will come into their own in the next three to five years as retailers calculate the cost of expansion, Green said.
The surge in retailer interest also justifies Dubais massive new capacity creation, both at existing locations such as The Dubai Mall as well as greenfield developments as on the Palm and JBR. The growth in retail will see a clear linkage to rental gains; there will definitely be a lot of hard bargaining between malls and retailers for new locations, Green said.
From a resident shoppers point of view, more is definitely merrier. It would be no surprise if malls represent 80 per cent of the entertainment value for residents and more so over the weekends, said David Thurling, vice-president mall at Al Ghurair Centre. It does not take more than a 30-minute drive to get to any mall in Dubai and residents can pick and choose where they want to be. This is the major challenge for a lot of the malls into how they can fit into the puzzle.
While luxury labels have more or less secured prime coverage in all possible locations, the local retail sector is seeing an influx of mid-tier and value-for-money (VFM) names. The lower, more affordable segment of the market is becoming stronger and stronger because of the current economic situation, said Ajai Kumar Dayal, retail consultant.
People are really looking for value for money, and if this is supported with the guarantee of a brand or the image of a brand (for instance H&M), they find it easier to buy. The middle is which is really under pressure today. It has neither the snob value of the high brands, and finds it hard to justify the additional cost versus value. The markets are reflecting the economic cycle that we are in today, Dayal said.
Dubai retains standing as global retail haven | GulfNews.com
Dubai retains standing as global retail haven
Emirate a close second to London in retailer representation, fourth in new store count
A mature marketplace it may be, but Dubais retail sector has no intent to slow down. It is getting a lot of help from global retailers intent on getting the word out that they will be opening soon in Dubai.
So much so, Dubai has easily retained its ranking as the number two destination in terms of global retailer representation, just behind London and well ahead of the likes of Paris, Moscow and New York.
In the latest annual rankings put out by the real estate consultancy CBRE, Dubai had a 53.8 per cent representation in terms of global retailer presence against Londons 55.5 per cent. These percentages are unchanged from 2012, while third-ranked Paris had 44.2 per cent retailer representation.
Dubai retained its position on another key score it was placed fourth among global cities which attracted new store openings in 2012, behind Hong Kong (still benefiting from being seen as a launch pad by brands with an eye on the mainland), Kiev and Berlin. In fact, Dubai shared the fourth spot with Singapore and Sao Paulo.
A presence in Dubai means global brands can get to have a buy-in from GCC tourists and simultaneously tap the international tourism market the emirate has created around retail, said Matthew Green, head of research and consultancy at CBREs regional operations. With the region doing well and growing at 3-4 per cent and even higher, Dubai is the key entry point for retailers.
American labels certainly appear to be in a rush to enter Dubai; they made up 18 per cent of all new market entrants last year. This is a trend that looks set to continue going by the still unsettled market conditions in western Europe, hitherto the most favoured destination for US brands.
For many brands, the bounce they are getting out of Dubai is the springboard for increased exposures in Abu Dhabi and Doha. Abu Dhabi, in fact, was among the top 10 cities favoured by luxury brands for new store openings last year. The two destinations will come into their own in the next three to five years as retailers calculate the cost of expansion, Green said.
The surge in retailer interest also justifies Dubais massive new capacity creation, both at existing locations such as The Dubai Mall as well as greenfield developments as on the Palm and JBR. The growth in retail will see a clear linkage to rental gains; there will definitely be a lot of hard bargaining between malls and retailers for new locations, Green said.
From a resident shoppers point of view, more is definitely merrier. It would be no surprise if malls represent 80 per cent of the entertainment value for residents and more so over the weekends, said David Thurling, vice-president mall at Al Ghurair Centre. It does not take more than a 30-minute drive to get to any mall in Dubai and residents can pick and choose where they want to be. This is the major challenge for a lot of the malls into how they can fit into the puzzle.
While luxury labels have more or less secured prime coverage in all possible locations, the local retail sector is seeing an influx of mid-tier and value-for-money (VFM) names. The lower, more affordable segment of the market is becoming stronger and stronger because of the current economic situation, said Ajai Kumar Dayal, retail consultant.
People are really looking for value for money, and if this is supported with the guarantee of a brand or the image of a brand (for instance H&M), they find it easier to buy. The middle is which is really under pressure today. It has neither the snob value of the high brands, and finds it hard to justify the additional cost versus value. The markets are reflecting the economic cycle that we are in today, Dayal said.
Dubai retains standing as global retail haven | GulfNews.com
