Middle East shopping, Middle East retail, GCC retail
The mood among Middle East retailers and local franchisees has been “overwhelmingly positive” in 2012, according to a new report by CB Richard Ellis.
CBRE said most retailers in the region have reported increased sales turnover and the outlook for consumer demand appears to be “highly promising”.
The report also said tourist numbers are also up across the region, with a particular buzz around the UAE.
CBRE’s view backs up similar comments made by rating agency Fitch earlier this week in which it said Dubai’s prime retail and hospitality sectors have performed well this year and are well placed for 2013.
CBRE said the major problem facing retailers in the Middle East at present was “securing sufficient trading space to accommodate the new brands being signed up by the franchisees as well as their aggressive expansion of existing brands”.
“As a result, many of the major regional players are flexing their muscles to push into established shopping centres during lease renewal periods, while also targeting up-and-coming retail markets such as Oman and Qatar,” CBRE added.
The report said an important issue for local franchisees will be dealing with the growing impact of the internet.
In the UAE, CBRE said much of the scope for expansion was occurring in Abu Dhabi with little new shopping centre space coming on stream in Dubai.
CBRE said the market continues to be a major focus for US retailers with several names, including Abercrombie & Fitch, rumoured to be planning entry.
The biggest US retailing group, Walmart, is also among those looking to develop a presence in the UAE market, in this case using the George sub-brand of its UK subsidiary Asda.
The report added that retailers will find yet more potential for further expansion within Saudi Arabia, with major new shopping centre schemes under construction in Riyadh and Jeddah.