Opening of new mall lets Majid Al Futtaim tighten grip on Dubai retail sector
Majid Al Futtaim (Maf) has tightened its grip on Dubai’s retail sector with the opening of its latest City Centre mall in one of the emirate’s key emerging neighbourhoods.
City Centre Me’aisem opened yesterday in the International Media Production Zone, the first addition to the City Centre collection of malls in the country in three years.
The Dh275 million mall houses 53 stores accounting for a gross leasable area of 23,850 square metres and expects four million visitors in the first year.
It aims to service 105,000 residents in the immediate vicinity spread across 11 new communities. Anchored by Maf’s own Carrefour hypermarket, City Centre Me’aisem has been developed as a community mall and will not compete with its super regional and regional malls such as Mall Of the Emirates (MoE) and City Centre Mirdif.
MoE is set to open its 36,000 sq m extension at the end of this month with a focus on domestic footfall as tourist spending comes under pressure.
“We have seen a decline in the number of tourists shopping in MoE,” said Michael Cesarz the chief executive of Majid Al Futtaim’s shopping malls business unit.
“We have compensated for the drop in tourist numbers with the retail mix, and the new extension will see a focus on luxury where we were slightly lacking before. We have 1,300 extra car parking spaces, 12 new restaurant concepts and a 24-screen cinema.”
Mr Cesarz declined to comment on when the delayed Apple store, which is reportedly part of the new extension, would open.
The shopping centre developer last month reported a 7 per cent rise in first-half revenues to Dh13.7 billion compared to a year earlier.
Occupancy across its shopping malls portfolio stood at 97 per cent as it attracted 85 million visitors through the period. Go Sport, the leisure chain, will be among the new stores opening in the Mall of the Emirates extension. It plans to open its largest Go Sport store with 3,300 sq m of floor space. It sees the MoE as an expensive but successful location.
“We know there are a lot of malls in the UAE struggling out there,” said Andrew Fairall, the general manager, sports division for Go Sport’s holding company Al Mana Group.
“Of course the rates [MoE] charged are biting into our profit but you have to be in the main locations. As long as we get some growth in the next year, we will be happy as I know a lot of people aren’t.”
While retailers may see pressure on profits, industry experts say the outlook for the emirate’s rapidly expanding shopping sector is positive.
“If you look at what Majid Al Futtaim has done with its community malls and MoE, it is very impressive,” said David Macadam, the chief executive of the Middle East Council of Shopping Centres.
“The new Me’aisem mall has a huge catchment area and if it has adequate parking it will beat most of the surrounding retail. With MoE, Maf has a brilliant concept. Emirates Airline buys and fills, on average, a new A380 Airbus every month so the tourist market is growing, as is the population of Dubai. All engines need tweaking to keep the motor running, and that’s what will happen.”
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Updated: September 1, 2015 04:00 AM