DUBAI: Dubai remained the second most important shopping destination in the world for a sixth consecutive year, just closely behind London, according to CBRE’s latest report on the global retail industry.
In its How Global is the Business of Retail? report, the property consultant said that Dubai now has a presence of 57.3 percent of international retailers, compared with 57 percent in 2016, as against London’s 57.9 percent. The study analyzed the operational networks of global retailers in 51 countries and 166 cities.
The emirate welcomed 59 new international retailers in 2016, a third of them specialist sellers for athletic-leisure brands including Under Armour, Jordan, New Balance and GapFit, attracted by sustained consumer demand from both overseas tourists and residents.
“These fashion-infused sportswear retailers are targeting the young working population of the emirate,” CBRE said.
Elsewhere in the region, Doha jumped six places in the new entrants’ ranking with 58 new brands in 2016, compared with 29 previously, as global retailers positioned themselves in anticipation of the 2022 FIFA World Cup which Qatar estimates will attract at least 1 million visitors.
The 500,000-square meter Mall of Qatar, which opened in late 2016, welcomed 66 percent of the new international retailers, most of them in the food and beverage sector. Major brands that were introduced at the mall include Victoria’s Secret and Abercrombie & Fitch.
CBRE meanwhile cautioned that Dubai’s retail sector is starting to show signs of stress despite a steady rise in the number of prime bricks-and-mortar retailers.
“Sustained economic pressures, the strong US dollar and lower growth in tourism are impacting sales figures,” the consultancy said, adding Dubai’s ballooning retail developments on the pipeline could likely bloat the emirate’s retail vacancy rates.
A JLL study reported that 350,000 square meters of retail space are scheduled for release in Dubai this year, with another 367,000 square meters listed for completion in 2018.
CBRE also took note of the rapid evolution of e-commerce in the region, which is complimenting “bricks-and-mortar stores and aiding the physical shopping experience for consumers”.
A study from Dubai’s Department of Economic Development and Visa reported that 56 per cent of consumers shop frequently online, making a purchase at least once a week at an average basket price of Dh1,479.
“With a dynamic, young population and one of the highest global per capita internet penetration levels, the online spending potential is quickly emerging as one of the highest in the world,” CBRE said.
Amazon this week completed its $650 million (SR2.44 billion) acquisition of Souq.com, a Dubai-based online retailer which accounts for as much as 78 percent of the e-commerce market in the Middle East and North Africa region.
Emaar Malls Group, which operates the world’s largest retail hub, was set to acquire a majority stake in online fashion retailer Namshi after failing to grab a stake at Souq.com earlier this year.
The retail giant Majid Al Futtaim took a significant equity stake in the Dubai-based logistics provider fetchr, while noon.com acquired JadoPado, a local e-commerce platform.
Noon, a $1 billion joint venture backed by Emaar Properties chairman Mohamed Alabbar and Saudi Arabia’s Public Investment Fund, was originally slated to launch in January with 20 million products on its platform but has been pushed back.