For better or worse, the pandemic is forcing change. More than two-thirds of consumers in the Middle East and North Africa (69 per cent) believe the way they live their lives will significantly change in the long term as a result of the Covid-19 virus. Here, RLI takes a look at the market across the Middle East and North Africa and highlights some of the key projects in the region as developers and their schemes gradually adapt to changing customer needs and expectations.
The EY Future Consumer Index said that 84 per cent of consumers declared that they have also changed the products they buy with a greater focus on value for money, and an increased commitment to consume locally made products.
Many consumer segments in the MENA region are adopting such values for the first time, with 68 per cent saying that their values have changed, and they look at life differently. This will have implications for what and how they consume in the future.
Ahmed Reda, MENA Consumer Industry Leader at EY, said: “One of the many things that both organisations and individuals have learned from the shared experience of the pandemic is how resourceful and adaptable they can be. Now attention is turning to what the world might be like once the crisis is behind us. While companies can’t forecast with certainty what consumers will be doing 18 months from now, they will need to anticipate the consumer requirements and values they will be trying to serve.”
According to the ‘Trends in the GCC Retail Market: The State of Retail Today and Predictions for a Post-Covid-19 World’ by CBRE and Roland Berger, the current outbreak of Covid-19 has had an unprecedented impact on the global economy, resulting in a widespread spending freeze and dramatic changes in consumer behaviour. Due to its interconnected nature, the retail industry is particularly vulnerable to the effects of this pandemic and has left retailers uncertain on both their immediate response and on their future in a post-Covid-19 world.
Prior to the effects of the pandemic, the retail sector in the GCC showed strong growth, with fashion and beauty in the region projected to add USD6bn between 2020 and 2023, reaching a market size of USD16bn in 2023. However, even before these unprecedented events, retailers have been faced with challenges to their businesses. The shift to e-commerce has impacted the nature of retail dramatically – which likely will be further exacerbated by Covid-19.
Retail is a dynamic and growing industry and e-commerce penetration is also seeing a surge, with more GCC retailers moving online to keep their businesses afloat throughout the crisis. The shift to online is not only witnessed among retailers but also in the case of landlords, such as Dubai Mall, to allow these destinations to remain relevant and accessible during these times of crisis. This unstable time has further highlighted the key elements of success in the retail industry that will keep retailers relevant and competitive in the future.
Today, Covid-19 has exacerbated the effects of already existing disruptions from technology and changing consumer behaviour, which is expected to widely alter the retail market landscape and retailers’ strategic positioning. We are also seeing rapidly growing retail supply starting to impact the retail market and causing leasing rates to drop. The combination of the global pandemic, technology-driven advancements and supply-driven challenges can leave GCC retailers and mall operators with great uncertainty in respect of their future positioning. Moving forward, retailers and mall operators will have to reimagine their current strategies not only to keep them relevant in today’s market, but also to anticipate the future of the industry and ensure long-term success.
PROJECTS ACROSS THE MENA REGION
Designed around the concept of a bamboo forest, the Forsan Central Mall exudes a restful ‘garden in the city’ feel. Known for its exceptional growth rate and versatility, bamboo reflects Abu Dhabi’s unique character and rapid development on the world stage. On the mall’s façade, a series of vertical green and brown elements create a bamboo forest effect. Forsan Central Mall is set to be the primary and only all-in-one shopping, dining and entertainment destination in the Khalifa City catchment area. Offering a rich variety of options including nine cinema screens, 22 F&B outlets, a 15,000sq m Lulu Hypermarket and Department store and 89 retail stores, the mall will cater to the basic and aspirational needs of the residents of this upscale community, while also serving as its thriving social hub. The soft opening of the mall took place in the third week of September and the project was developed by Line Investments & Property LLC.
A 2.4km-long leisure and dining waterfront project, Al Qana, located in the Khor Al Maqta area of Abu Dhabi is planned for completion in the final quarter of 2020, designed by local firm MZ Architects. The project is being developed by Al Barakah International Investment, in partnership with Abu Dhabi Municipality. The multi-purpose project will house a sophisticated five-star hotel, a range of international restaurants and cafes, galleries and entertainment venues, a cinema, an open-air theatre, sports facilities, jogging and skating path, children’s golf, high-end retail stores, a marina, various gardens, water fountains and ample parking spaces. The project is part of the National Trail that reflects the identity of the seven Emirates and stretches from the Corniche to the city’s new Capital District.
Reem Mall, the brand new shopping centre on Reem Island, will be home to the world’s largest indoor snow park. Once completed, the two million square foot shopping centre will offer new retail, leisure and entertainment options for people in Abu Dhabi. Attractions include the world’s largest snow park, a multiplex cinema, 85 food and drink outlets and 450 shops. Reem Mall is expected to open late this year following the completion of the AED 4.4bn development by The National Real Estate Company (NREC) and United Projects for Aviation Services Company (UPAC).
The redevelopment of Sheikha Fatima Park is a joint venture between IMKAN and The Department ofMunicipalities and Transport (DMT), Abu Dhabi City Municipality. As part of the urban framework vision for “Plan Abu Dhabi 2030”, multifaceted initiatives were implemented to respond to evolving community cultures, to enhance social liveability, and to provide unique sustainable and connected environments. In line with the park’s theme of active wellness, visitors can expect a robust suite of leisure and sports activities to include a skate park, basketball court, splash pads, zip line, outdoor yoga, pop-up movies and small concerts among others. Visitors will also be able to park in a dedicated parking structure with over 300 spaces. The retail element of SFP will be set across 10,000sq m and six boutique style buildings, which is set to open this year. The merchandise mix will be curated to offer fresh exciting concepts that support and prioritise local start-ups and regional brands that cater to activities, wellness, education and quality food. It is an all-premium offer, but an offer available at affordable pricing.
Saadiyat Grove by Aldar Properties will be a magnificent development that offers elegant designed residential units located at Saadiyat Island, Abu Dhabi. The development comes in phases and features 60,000sq m of experiential retail, entertainment and leisure spaces designed to create an exclusive community surrounding. The impressive first phase of Saadiyat Grove will host 606 residential homes along with 200 retail outlets including state-of-the-art amenities such as a gymnasium, kids play area, community garden and running and jogging tracks. The development is set to transform the urban landscape of Abu Dhabi when it opens in 2022, with its strategic importance of the capital at both cultural and social level with its future vision of live, work and play model and with a focus on creating and delivering an exceptional and memorable experience.
The upcoming Mall of Dilmunia represents a balanced modernistic and futuristic architecture which creates an exciting family oriented universe within it. It will include retailers from across the MENA region that are yet to enter the Bahraini market, it aims to provide a quality entertainment, leisure and retail destination, which adds value to the Island’s tenants and guests. Being developed by Dilmunia Mall Development Company, the Mall of Dilmunia will redefine the shopping experience in Bahrain by adding urbanity to the retail experience through the development of a Boulevard. It provides visitors with the illusion that they are outdoors within a vibrant European cityscape. The open-air sky terrace allows visitors to take in the breath-taking view of the island of Muharraq. The terrace is to also include a beautiful mosque representing the Islamic family values, culture and lifestyle.
Seef Properties, an integrated real estate development company in Bahrain, has said work is nearing completion on its mixed-use development project, Al Liwan, coming up at Al Hamala area of the kingdom’s Northern Governorate. A first-of-its-kind project in Bahrain, Al Liwan will boast a combination of exceptional commercial, entertainment, and housing facilities. The 122,000sq m venture features a wide variety of restaurants, cafes and retail stores topped with 117 three-storey residential units that overlook stunning views. Al Liwan also includes a state-of-the-art cinema theatre, a family entertainment centre as well as open areas and boulevards, granting its residents the most memorable experience, said the developer. With the work in full swing on the ambitious Bahrain project, it is expected to open its doors by the first quarter of 2021.
A state-of-the-art community mall designed to present to the end-user a simplified, ultimately convenient shopping experience, Festival Plaza also focuses on the experiential; with developer Al-Futtaim’s aspirations for the destination centered on creating a place where people share memories and social experiences. Festival Plaza opened at the end of last year and is located in close proximity to some of Dubai’s most heavily populated residential communities, such as Dubai Marina and Jumeirah Lakes Towers, and its appeal as a shopping destination for these affluent districts is enhanced by the inclusion of the UAE’s largest IKEA furniture store. Additionally, the development features an ACE Hardware store, more than 120 retail outlets within the mall itself, a food court with 40 F&B offerings, and 2,310 parking spaces.
Singapore-based, Chinese firm Samanea Group will develop a 570,000sq ft retail mall in Dubai which will focus on home appliances and furniture. Dubai developer Meraas has signed a memorandum of understanding with Singapore-based Chinese company Samanea Group that will see a $272M mall come to fruition in 2021 near Dubai International City. The inaugural Big C Forum witnessed the signing, with six key Chinese manufacturers and businesses also inking the letter of intent. Samanea Group will develop the 570,000sq ft retail outlet which will focus on home appliances and furniture from small, medium and big Chinese businesses seeking a foothold in the GCC market. The mall will also hold space for 1,800 parking spaces and currently has no opening date as it is still in the design phase.
Mica Mall is still under construction and set to open its doors by year end. As one of the biggest shopping malls in the region and a most prestigious project in Iran, Mica Mall is responding to the coronavirus pandemic with a widespread and comprehensive Corporate Social Responsibility initiative. A unique mall concept located in the heart of Kish Island; Mica Mall is a mixed-use shopping and entertainment project with a total built up area of 202,000sq m. Over 600 retail shops and 18,000sq m of entertainment spaces are located over five floors. Some unique entertainment facilities in Mica Mall include the Cable Car from the beach directly landing on the roof of the mall – first ever in the world, Olympic size ice rink turning into concert hall, aquarium, indoor skydiving, cinema and Penguin Park… in addition to retail, restaurants, café and a hypermarket.
The Al Khiran Hybrid Outlet Mall in Kuwait is set to meet heightened shopper expectations by offering a combination of high value and dynamic experiences through a mix of premium outlet shopping, curated dining, immersive entertainment, large format events & exhibitions and recreational leisure experiences. The project area is spread over 350,000sq m, the total GLA of the upcoming outlet is 70,000sq m and it will be home to 300 retail stores. Al Khiran Hybrid Outlet Mall is being developed by the Tamdeen Group which has consistently delivered exceptional real estate including the award winning 360 Kuwait and Al Kout with a single-minded purpose; To Build Great Places.
Majid Al Futtaim has announced a new opening date for Mall of Oman. The mall is now scheduled to open its doors to customers in September 2021. The revised opening schedule has been put in place to ensure that Mall of Oman’s tenant partners are best placed, with ample time, support, and resources, to prepare their new stores adequately. This will enable them to deliver the quality of service they and Majid Al Futtaim are renowned for. Mall of Oman is primed to become Majid al Futtaim’s fifth and largest shopping and entertainment destination in the Sultanate. It will have 145,000sq m of retail space, comprising of dining outlets and a range of lifestyle experiences. In addition to 350 retail outlets, the mall will also house Oman’s largest VOX Cinemas, a Magic Planet family entertainment centre, a 12,100sq m Carrefour Hypermarket, and the largest indoor snow park in the Sultanate.
1364 will be a world-class shopping, dining and entertainment centre that offers Saudi society a place to express themselves and fulfil their modern desires. The 1364 shopping centre will be a location as unique as the Diplomatic Quarter itself, with extensive greenery and water features to ensure that the project is an extension and continuation of the Diplomatic Quarter, with well blended contemporary architectural practices and a modern, attractive merchandise mix to attract young professionals and families from all over Riyadh. Set to bustle with energy and activity, day and night; there will always be something new for guests to discover at the 1364 site, from live music, casual bites, play areas and an extensive cultural scene, 1364 springs to life, offering ever-changing activities for families and trendy meeting places that create the ultimate social scene. An opening date for the project has not yet been announced by developer Unified Real Estate Development Co.
Currently due to be inaugurated in 2022 and being developed by Shomoul Holding Company – part of Mabanee, The Avenues Riyadh project is set to become the largest leisure and commercial destination in the Kingdom. The first design and construction phase of the project has been awarded to Nesma & Partners Contracting Company in a $1.6bn deal. The first construction phase of The Avenues Riyadh entails building a fully-fledged mall, with parking lots, gardens, and internal roads. The project is anticipated to become a new retail icon in Saudi Arabia and the region thanks to its innovative shopping and entertainment offerings, services, and hospitality concepts that support Saudi Vision 2030 and set a new global standard for a delightful recreational experience. Upon full completion, the project will cover an area of 1.9 million square metres, and will feature a shopping mall with an area of 400,000sq m and more than 1,300 stores, in addition to five towers with commercial and residential facilities and four hotels.
Set to be unveiled in Q1 2024, Mall of Saudi will be the Kingdom’s flagship destination for retail, leisure and entertainment, offering Saudi Arabia’s most prestigious stores as well as new brands making their debut in the market. Mall of Saudi will represent the next generation in integrated shopping, entertainment and dining. Designed as a lifestyle venue, the mall will contain the most recognisable brands in retail, from fashion and home styling to electronics. Being developed by Majid Al Futtaim, the mall will feature 296,000sq m of GLA, over 600 stores, 10,300 parking spaces, 33,200sq m dedicated dining space, a five-star luxury hotel with over 275 rooms, a 9,500sq m Carrefour hypermarket and a 40,000sq m indoor ski slope and snow park. The master-planned layout and luxury concept stores will be the ultimate in accessibility and curation. This ambitious vision will deliver seamless transitions from the shopping experience to a wide variety of food and beverage options and a mix of entertainment venues.
Offering an upscale shopping experience for the inhabitants of Al Rehab City and its environs, Boulevard Al Rehab is set to become a privilege for the community. The mall will cater for all age’s groups with a various range of facilities. The concept of Boulevard Al Rehab is characterized by a well-balanced structure between commercial and retail spaces, in addition to global brand hypermarket and wide range of international brands. The family & friends facilities combination is enhanced by a kid’s entertainment area as well as a cinema which is operated by leaders of the field. A start up project by a prominent real estate investment group, United Global Company (UGC), with a capital investment of around 1.2 BillionEGP, Boulevard Al Rehab has an area of 25,000sq m, out of which the total construction area is about 100,000sq m comprising 6 different levels.
The Morocco Mall Marrakech project was designed by DPA, a prestigious architectural firm from Singapore. The design was inspired from the surrounding geological and natural landscapes, made of luxuriant nature and inclined to leisure and relaxation. Morocco Mall Marrakech puts the customer experience at the heart of its architecture, offering a meticulous selection of shopping and dining, a clear orientation towards leisure and entertainment, and the city’s first showcase for luxury brands. At the forefront of trends, visitors of the Morocco Mall Marrakech will enjoy, with family or friends, a stimulating experience with indoor and outdoor paths, gardens, fountains, waterfalls and shops. The project is being developed by Aksal Group, will cover an area of 50,000sq m sales on a total area of 135,000sq m and be home to 190 stores and is currently scheduled to launch in 2022.
Currently under construction by Indigo Property, Tunis Garden City is a concept that imagines a district that is well connected to the rest of the city, yet combines the essential components of a self-contained community, thus making Tunis City Garden as a ‘city within a city’. The new city of Tunis will be served by a number of facilities including office and residential buildings, a museum, an entertainment and leisure, a hotel/service apartments and retail components. However it is the retail and leisure offering, situated at the heart of the community, which makes this development exceptionally unique. The project is currently due to open next year.