Dubai retail space to grow by 50% in next three years
The growth of the UAE's retail segment will influence the future relationship between real estate owners and tenants, a CBRE expert says
Retail space in Dubai will grow by 50%, or 150ha, over the next three years.
This figure represents roughly 70% of the total retail supply expected in Dubai over the same time period.
CBRE's How Global is the Business of Retail? report for 2018 cites Dubai as the top market for retail growth, with 62% of all global retailers present in the emirate.
Experts say a "massive real estate market transformation" is under way in the UAE as the country prepares to host Expo 2020 Dubai.
HE Hamad Buamim, president and chief executive officer of Dubai Chamber of Commerce and Industry, said: "Despite changing market conditions, the growth outlook for the market remains robust, supported by key factors such as rapid expansion, rising number of tourists, Expo 2020, and a significant amount of new retail space expected to come online."
The growth of the UAE's retail segment will also inform the future relationship between real estate owners and tenants, the latter of which are compelled to rethink their strategies as the traditional, brick and mortar retail model is tested by e-commerce and concepts such as 'edutainment'.
Nick Maclean, managing director of CBRE's Middle East and Turkey operation, explained: "The UAE will see the delivery of a significant amount of retail space over the next five years.
"Dubai remains the most attractive market in the region for retailers, with many using the emirate as a launch-pad for regional expansion.
"Advancements in retail technology and e-commerce have, however, forced retailers to rethink their strategies.
"Together with the expected growth in online shopping and the increased importance of hybrid concepts, the contractual relationship between landlords and tenants is set to change substantially going forward."