Hyperpanda to shutter its doors in Dubai Festival City
Hyperpanda is set to close after trading for more than a decade at Dubai Festival City Mall.
A customer service representative confirmed a clearance sale was expected to start this week. About 400 people are understood to work at the vast hypermarket, the only Hyperpanda in the UAE.
Riyadh-listed Savola Group, the parent company of HyperPanda, and Al Futtaim, the owner of Dubai Festival City Mall, did not return requests for comment.
The 175,000 square feet store opened in 2006. The closure of the store comes as traditional retailers and mall owners come under pressure of slowing economic growth, a strong dollar and the growth of e-commerce.
Savola, one of the largest food and retail groups in Saudi Arabia, reported its first quarterly loss in eight years for the fourth quarter of 2016, when it lost 964 million Saudi riyals (Dh944.1m).
The group closed 51 smaller Pandati stores last year as the economic slowdown in the kingdom hit consumer demand.
“Due to the rapid deceleration in grocery retail, the performance of these assets fell below forecasts and the inventory purchased in anticipation of these forecasts was high,” it said in a filing. The company said it would reconfigure its operating model in retail.
The UAE had 459 supermarkets and hypermarkets last year, a figure expected to grow by 7 per cent this year thanks to new shopping malls and the expansion of residential areas, according to Rabia Yasmeen, a research analyst with Euromonitor International.
“The segment expects to see competition from the developing convenience store segment, with many convenience stores adding fresh food items,” she said. “Many hypermarket players would be seen diversifying into the supermarket segment, including an increased focus on online retail.”
In 2014, Azizia Panda United Company, a unit of Savola and now known as Panda Retail, said it would invest Dh3 billion during the next three years to expand HyperPanda in the UAE, and also open supermarkets.
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Updated: March 27, 2017 04:00 AM