DUBAI, 15 March 2007 — The retail real estate market in the GCC countries is the fastest growing in the world, said Colliers International — one of the top three global property service consultants.
More than 16.35 million square meters of Gross Leasable Area (GLA) expected to be completed by 2010. The increase represents a massive 565 percent growth in the available GLA found in the region since 2000, up from 2.46 million m- at the start of the millennium.
According to report, the UAE and Saudi Arabia will see the highest increase, contributing 44 percent and 30 percent respectively of the GLA by the end of the decade. Kuwait will be the third largest provider making up 10 percent of the supply coming online by 2010, with Qatar supplying eight percent, Bahrain seven percent and Oman with one percent.
“The next four years will see an explosion of new retail space, which is unlikely to be paralleled by any other global region. GCC countries have made massive investments into their retail real estate markets and we are seeing some of the world’s most spectacular malls come online, giving the region increased international recognition” said Stuart Gissing, regional retail director, Colliers International.
Dubai will witness the largest actual increase in GLA by the end of the decade, from 1.37 million in 2006 to 4.25 million. In contrast to some other GCC states, Dubai will not undergo a period of stabilization for retail real estate in the foreseeable future.
In terms of leasable area, over 218,000 sqm of GLA was released onto the market in 2006. In 2007, close to 358,000 sqm of GLA is expected to be unveiled, followed by a massive 969,000 sqm of GLA in 2008. This year alone will see a 26 percent increase in the amount of leasable area available in Dubai over the preceding year.
Kuwait is expected to see the largest percentage growth in domestic retail GLA with an increase of 233 percent coming online by 2010 — which represents a rise from 345,000 sqm in 2006 to 1.15 million sqm by the end of the decade.
The leasable area in Abu Dhabi is set to increase from 574,000 sqm at the end of 2006 to 1.4 million sqm by 2010, an increase of 145 percent, with the UAE capital focusing on developing its Grade A retail space.
In 2006, Colliers International was tracking 4.45 million sqm of existing retail space in Saudi Arabia, 2.1 million sqm of which is in Riyadh and 1.7 million sqm in Jeddah. By 2010, the available space will increase by 56 per cent to 6.95 million sqm New supply is concentrated in Riyadh and Jeddah, with 765,000 m2 to be constructed in Riyadh and 870,000 m2 in Jeddah.
According to Colliers International’s research, approximately 450,000 sqm of gross leaseable retail space currently exists in Qatar, with an estimated 500,000 sqm GLA scheduled for completion between 2007 and 2010, and a further 235,000 sqm in planning phases to be delivered beyond this date.
In Bahrain, there are 278,000 sqm of GLA in shopping centers in Manama, with an additional 600,000 sqm of GLA under construction, an increase of 216 percent by 2010.