Saudi malls gearing up for a new future with big screens and entertainment

JEDDAH: Malls in Saudi Arabia are getting ready to take advantage of the government’s decision allowing them to open cinemas. Mall operators across the Kingdom say they are locating space for theaters and exploiting empty units.
Major work is expected in the next seven months in the preparation of malls. Mohammed Rashid Aba Al-Khiel, head of the digital sector and marketing at the Arab Centers, the largest developer, owner and operator of commercial centers in Saudi Arabia, told Arab News that the decision had been expected since the end of 2016.
“The decision comes as part of the package of economic entertainment projects to ensure that the money, or part of it, remains at home in the local content,” he said. Aba Al-Khiel added that the plans extended to cafes, entertainment and sales.
“Cinema adds to the experience of the beneficiary, especially with high temperatures and the dearth of (entertainment) options for Saudi families, which are limited to malls...”
He added: “If the operators can run movie theaters effectively, it is possible to keep pace with similar experiences in neighboring countries. We lack the operational experience in dealing with the film industry and its economic benefit. We suffer from a lack of experience in this field. Global experience should be considered.”
Malls have multiple options to take advantage of the decision, depending on the sizes and allocations of screens, diversity of the target segments and the value of the content, he explained.
The chairman of the commercial centers’ committee at the Jeddah Chamber of Commerce and Industry (JCCI), Mohammed Alawi, told Arab News that a large group of malls had considered this decision and some included its engineering plans. Some malls have included it as their first choice to expand their investment and development plans.
Alawi said: “Some of these malls are targeting areas that were vacant and will begin to move directly to reformulate these sites and arrange them economically so that they can be configured.
“After the approval, global operators from all over the world will come to create an integrated cinema style according to the latest standards. This will encourage investors to move and find financial flows in the markets.”
Alawi expects that all malls in Saudi Arabia will work to keep up with the decision in the next seven months. “Malls that do not have cinema-equipped buildings will move and provide space even if they exploit some economically inefficient locations.”
Alawi, who previously ran the Red Sea Mall, said: “The Red Sea Mall, for example, would provide at least 12 cinema screens, with at least 300 seats each, currently being built.”
He explained that the flow of capital abroad throughout the year was not justified, and greatly hurt the Saudi economy. Alwai said that 6.5 million cinema tickets are booked annually online in Bahrain, of which 5 million are from Saudi Arabia.
“SR80 billion ($21.3 billion) is spent annually outside the country. The Vision (2030) aims to keep 50 percent of them domestically. The cinema decision can revive transport, subsistence, contracting companies and jobs for Saudis.”
Ryan Kadouri, director of the Red Sea Mall, told Arab News that the decision is great and will have a positive impact on the retail sector, will create a huge economic momentum in doubling the number of visitors to malls and will revive markets after the recession experienced in the past two years.
“It will provide support to the local market and create great job opportunities for Saudis. It will help increase the number of visitors to the malls.”
He said the volume of visitors accustomed to traveling abroad is expected to reach 21 million to the Red Sea Mall in 2018 from 18 million visitors in 2017.
Kadouri said: “Cinema projects are expected to take time because they are linked to specialized international companies, and all are waiting for the official mechanisms. We are in the process of preparation. The market will recover significantly.”
He pointed out that commercial malls are looking for open spaces and to keep pace with the variables of the market.
“The right operator should be chosen as well as the importance of quality, transfer of expertise and the use of modern technologies … and the allocation of showrooms for different segments of society, and so on.”